Cryptocurrency Ban in India?

Share your love

In the current Winter Parliamentary session, the Central Government is going to present the Cryptocurrency and Regulations for Officials Digital Currency bill 2021. There have been reports in the past that the cryptocurrency ban in India by the Government. There were reports that quoted official sources as declaring that the government could allow investing and trading in cryptocurrency with certain limitations.

Crypto Currencies

Experts say it isn’t feasible to completely ban cryptocurrencies. But, the government might restrict or ban the trading of crypto as well as its use as a method of payment or exchange. “Cryptocurrencies are based on blockchain technology that is independent of the person who controls it. The decentralization aspect of the blockchain distinguishes it from other currencies which may be under the control of a single organization.

Governments have the power to prohibit the trading of cryptocurrencies and stop using them to make payments, “Edul Patel, CEO, and co-founder of the global crypto investment platform that is based on algorithmic trading Mudrex stated to FE Online.

Patel added “Exchanges are able to be stopped for specific countries. However, imposing a total ban on cryptocurrency will never be feasible. Decentralized transactions aren’t an option. Decentralized exchanges are not within the purview of any government or organization. They are run by communities of crypto enthusiasts and developers. Thus, even with an overall ban on cryptocurrency to facilitate transactions, it is not feasible to put a complete restriction on cryptocurrency. ”

cryptocurrency to be banned in India

Why?

Cryptocurrencies were not considered an issue for financial stability, but the growing volume of transactions has raised questions for central banks around the world. In October 2021 it was the first time that the growth of cryptocurrency assets was cited among the risk factors identified to global financial stability from the IMF.

Hitesh Malviya, creator of itsblockchain.com stated that “In my knowledge, Ethereum bitcoin, as well as other well-known cryptocurrency are not managed or controlled by any private entity, transactions are recorded on the public ledger, and are recognized as cryptocurrencies that are public in all major economies.

On the contrary, many cryptocurrencies are being advertised by MLM companies and private businesses that are operating in the country at the moment These kinds of cryptocurrencies were subject to several massive frauds over the years. Therefore, if the government wants to prohibit privately owned cryptocurrency then it’s a wise move.”

How Big Is Crypto in India?

It is among the largest markets in the world and growing rapidly. In a report released in October by Chain lysis, a firm that analyzes crypto-related data the Indian market increased by 641 percent from July 2020 to June 2021. In total the southern and central regions of Asia were the fourth largest crypto market, with over $572.5 billion worth of value in that period, or 14 percent of the total value of transactions.

Transfers of more than 10% million accounted for 42 percent of transactions made through India-based addresses in that period, while 28 percent in Pakistan as well as 29 percent in Vietnam. This suggested a more advanced Indian market. However, India with a relatively young and technologically savvy population was the second-highest ranked country after Vietnam in terms of cryptocurrency adoption by investors who are retail across the region.

What are India’s Concerns?

The Reserve Bank of India says that they are a serious threat to the country’s macroeconomic as well as financial stability. India’s currency is only partially convertible, giving the regulator control and insight over who has access to the market of the country. The nature of cryptocurrencies is to be traded freely and anonymously, which means they can elude authorities’ oversight and the possibility of taxing transactions. Issues with money laundering and financing of terrorism are also being discussed.

Share your love