For a few months now we’ve heard from various countries that are considering introducing a regulation for cryptos. These discussions are shaking the cryptosphere. In fact, the effects of compulsory regulation on cryptocurrencies would be very bad. On Friday January 30th, 2021, India just announced its plan to regulate cryptos. At first glance, this is cause for concern …
The Indian government is considering banning cryptos
The news surprised everyone! On Friday, January 30th, 2021, the Indian Parliament gave some guidance on the implementation of crypto regulation. The law in question would provide for a ban on all so-called « private » cryptocurrencies in the country. In parallel, the country would set up a national electronic currency that is supported and administered by India’s central bank.
Nothing has filtered out which cryptocurrencies would be affected by this ban. However, there is good reason to believe that by « private » the government means any electronic currency that is not managed by the central bank. In that case it would simply mean banning all cryptocurrencies in India!
So this law is terrifying! « Now is the time to be concerned, » a senior crypto exchange official in the country told the Economic Times of India (on condition of anonymity). In addition, given the political makeup of the Indian Parliament, there is a good chance that this bill will not be called into question.
The question of crypto regulation
With the boom in cryptos and Bitcoin, especially in 2020, the issue of regulations for governments has come back to the fore. It is currently the main threat to the future of cryptocurrencies.
In addition, this consideration comes in parallel with the creation of a national electronic currency in many countries, e.g. B. E-Dollars, E-Euros, E-Pounds, etc. In this context, however, some governments would view the crypto ban as a way to ensure the success of their national electronic money. That way, they could stay in control as the central banks would keep control of these currencies.
“Hasty and bad regulations will set India back 10 years. Conversely, good regulations will catapult India into the countries that are at the forefront of this technology. «
Nischal Shetty, CEO of the Indian exchange WazirX
For many, this was why India banned cryptos. According to Nischal Shetty, CEO of Indian stock exchange WazirX, he criticized the government’s announcement on Twitter. For him, the government’s goal is to clear the way for the arrival of their national electronic central currency. Much is at stake in a country that is very open to cryptocurrencies. With this step, India would be the first country in the world to ban cryptos. It would then lose the lead in crypto compared to other countries.