The Indian Government is stepping up its efforts to ban cryptocurrencies in India!
According to a recently surfaced media report, the GOI is currently considering blocking internet protocol addresses, aka IP addresses, of all cryptocurrency firms/exchanges. Industry experts believe that the Government, by doing so, is hoping to successfully block all known operating platforms which allow crypto trading and investment in India. However, it won’t be foolproof in execution.
Prior to this, in the month of January, the Cryptocurrency and Regulation of Official Digital Currency Bill got listed in the Lok Sabha’s bulletin. Even though the bill has not been introduced in Parliament so far, the recent discussions about blocking access to crypto exchanges suggest that the GOI is slowly moving towards executing on the same.
The Crypto bill will be facilitating the introduction of a new framework for India’s official digital currency, which will be issued by the RBI aka the Reserve Bank of India and, in turn, prohibit the use of all private cryptocurrencies in the country.
After its implementation, the bill will criminalise the issuance, mining, trading, possession (investment) and transference of crypto assets. But that being said, no concrete decision has yet been reached as of right now. Because, quite recently, Nirmala Sitharaman, the Finance Minister of India, said that the country will not shut down all options when it comes to cryptocurrencies.
Now, in the event the GOI goes through with the ban, virtual private networks aka VPNs could come to the rescue and help consumers continue trading in digital currencies.
An industry expert, in a statement about the same, mentioned that various routes such as peer-to-peer trading, using international digital wallets to store and transfer cryptocurrencies, VPNs, and more are some big loopholes that will continue to exist even if the ban gets executed.
Currently, the entire global world of finances has its eyes on India’s outlook and final verdict on cryptocurrencies. In the previous month itself, a whopping $2.3 billion worth of crypto was traded on India’s largest cryptocurrency exchange WazirX.
The figures stood at $1.4 billion in January, and before that, it was at $500 million in December 2020. This shows that India has severely grown its appetite for cryptocurrencies, and Indian investors have gone way further than simply wanting to dip their toes into this space.
All in all, it is well understood that if the GOI wishes to ban crypto in India, it has more to lose than benefit from it. Besides going against the obvious consumer demand for cryptocurrencies that is clearly visible, India will be forgoing the underlying blockchain technology, which has the potential of transforming every single industry that relies on contracts and transactions. Blockchain has the ability to maintain irrefutable proof of ownership when it comes to owning digital products or art, executing smart contracts and much more.
It now remains to be seen if, against all the pros, India will still approach the regulation of crypto with a heavy hand. We will keep you updated on all future developments. Until then, stay tuned.