Amidst Global Uprising of Digital Currency, Indian Policy Suggests Potential Ban
Indian government is facing a dilemma over the involvement of digital currency in Indian economy.
Digital currencies like US-based Kraken, Hong Kong-based Bitfinex and rival KuCoin are actively scouting the Indian market. The experts are saying that digital currency has great chances of getting big in India in future. These foreign companies are currently dwelling over two choices, whether to set up new business in India or buy an Indian firm as did Binance. All three exchanges are ranked in the world’s top 10 by data platform CoinMarketCap, based on their traffic, liquidity and trustworthiness of their reported trading volumes.
Kumar Gaurav, the Founder of digital bank Cashaa has reported to Aljazeera, “The Indian market is huge and it is only starting to grow, if there was more policy certainty by now, Indian consumers would have been spoiled for choice in terms of exchanges because everyone wants to be here.” India so far had no rules specifically for those cryptocurrency exchanges who are wishing to set up in the country. Instead, they could register themselves as tech companies to obtain a relatively easy entry path. In 2019, Binance acquired WazirX, an Indian cryptocurrency startup that has allowed users to buy and sell crypto with rupees on the Binance Fiat Gateway. US-based exchange, Coinbase, has also announced plans for a back-office in India.
Amidst all this, Indian government was set to present a bill to Parliament by March that proposed a ban on cryptocurrencies, making trading and holding them illegal. But the government has held it back, and conflicting statements since have fuelled uncertainty over the bill’s fate. Meanwhile, major Indian banks have begun to sever ties with cryptocurrency exchanges and traders. RBI has expressed concerns about the stability risks that are posed by such digital volatile assets. Rich people and criminals will also get a chance to hide their money in such digital assets to avoid tax.
Currently, some digital currency exchanges clearly reckon it would be better to gain entry in India rather than miss out. It is because India presents a huge market. However, Indian government is still under the dilemma regarding the disadvantages and positive effects of digital currency. The expert analysts have reportedly predicted that very soon the prospects of reward would outgrow the thoughts of risk and digital currencies would receive a welcoming entry in Indian economy.