With a few exceptions, the government intends to outlaw all private cryptocurrencies in order to pave the way for a centrally controlled digital currency. However, this may not be as severe as it appears.
The specifics of the proposed legislation are unknown, leaving cryptocurrency investors hoping that they will still be able to trade in what has become a thriving sector in India.
How enormous are cryptos in India?
According to Chainalysis research, the market has exploded more than 600% in the past year since the Supreme Court overturned a previous ban last year.
According to the Blockchain and Crypto Assets Council, between 15 and 20 million people in Asia’s third-largest economy own cryptocurrencies (BACC).
Advertisements featuring Bollywood and cricket stars for home-grown cryptocurrency exchanges such as CoinSwitch Kuber and CoinDCX have bombarded Indians.
Would Cryptocurrency ban in India work better for India?
It is difficult to outlaw the tokens because they are pieces of code with no inherent value. It’s similar to sharing a computer file when you transfer them from one virtual wallet to another.
However, the cryptocurrency exchanges that most investors use to buy and sell tokens may face increased scrutiny.
According to Bloomberg News, the government may also impose a minimum investment amount in digital currencies while prohibiting their use as legal tender.
“Obviously, the wording of (the bill announcement) was unfortunate, which caused a bit of panic in the market,” said Ashish Singhal, co-chair of the BACC and founder of exchange platform CoinSwitch Kuber.