With the increase in the global consumer of cryptocurrency, India has also seen a record increase in the use of digital currency. The number of active consumers is nearly 15 million and the increase in blockchain business has also seen a rise from 100+ in 2018 to 300+ in 2021. According to a survey, the crypto assets with Indian consumers are pretty good which sums up to around $1.5 billion and the daily trading of crypto stays between $350 to $500 million. In this article, we will discuss about Indian cryptocurrency legalization. Here is some cryptocurrency news in India.
Future Of Cryptocurrency In India
Despite the fact that prohibition on Indian cryptocurrency legalization was reversed on the grounds of proportionality by the Supreme Court, the latest decision of ICICI Bank occurred after RBI requested that banks to informally stop any operations related to digital currency.
According to an HDFC Bank official,
“We are simply following the RBI recommendations provided to us. Our options are limited until and unless the regulator changes its attitude on cryptocurrency.”
When the RBI was asked why they were risking the obstruction of justice, a senior officer from the RBI asserted that they are not aware of the ICICI Bank’s actions. He also added that the central bank holds to authority to restrict any operation or currency that can affect the Indian currency in any manner. In view of the fact that the finance ministry has claimed that digital currencies have no inherent value, and are not considered to be an asset, RBI must monitor the conversion of INR into cryptocurrency value in India. The official added that the valuations of Bitcoin or other digital currencies are highly insatiable and RBI cannot handle so many fluctuations during a time when the economy of the nation is struggling so much.
The Finance Ministry Is Responsible For Indian Cryptocurrency Legalization
Many wonders, is cryptocurrency legal in India 2021? The Government Of India, earlier this year broke a bombshell announcing the emergence of the “Cryptocurrency and Regulation of Official Digital Currency Bill, 2021”. This act will be placed in the Legislature’s Budget Session. The aim of this bill is to make all private digital currencies illegal in India and formulate a legislative regime for the Reserve Bank of India to build its official cryptocurrency. But the Indian cryptocurrency name has not been decided yet. However, the bill will allow some exclusion to be able to promote the fundamental technology and application of digital currencies.
Despite the debate revolving around the bill, it was not placed in the Parliament. Later on March 5, the Finance Minister Nirmala Sitharam stated that the government is trying to negotiate with the RBI and will take cautious actions on this issue.
Nischal Shetty, who is the Chairman and President of WazirX which is a cryptocurrency platform that is owned by Binance, asserted that India is not a niche industry anymore but a quickly developing financial sector during a webinar. Despite the rise in the use of digital currency, this country lags behind in respect to the regulatory frameworks and the level of potential businesses in crypto. This country must encourage entrepreneurs to make new cryptos.
India’s Attempt To Legalize Cryptocurrencies
Was cryptocurrency legal in India 2020? As many international players are trying to enter the Indian crypto market, the cryptocurrency is yet to receive formal approval. The cryptocurrency ban in India 2021 is still cannot be said. The situation is mid way. According to a report, Bitfinex, Kraken, and KuCoin are competing to be the first to launch on the subcontinent, after the market leader Binance. Binance bought WazirX, which is a home digital currency start-up that enables consumers to purchase and sell Bitcoin with Indian rupees through the Binance Fiat Gateway, in 2019.
Coinbase, which is a US-based platform, has also asserted its wish for an Indian back-office. Bitfinex, Kraken, and KuCoin are all among the best crypto exchanges in the world, according to CoinMarketCap, which ranks them based on liquidity, traffic, and reliability of reported volumes of buy and sale. According to the founder of a digital marketing agency,
“The Indian market is huge, and it’s just getting started. By now, if there had been more coverage certainty, Indian customers would have been spoiled for choice in terms of exchanges since everyone wants to be right here.”
However given these scenarios, the government has to find a transparent method for Indian cryptocurrency legalization. This is not going to be so simple.
Indian cryptocurrency legalization is a long process as the government is not ready to accept digital currencies as an asset. Even though international players are trying to enter the Indian market, the game is not going to be so easy for the Indians.
FAQ On Indian Cryptocurrency Legalization
Investing in digital currency has always been a legal investment in India and the new RBI notice clearly states the right to do business with crypto firms.
When the government was aiming to put a ban on digital currency, the Supreme Court of India suggested some official regulations instead, in 2019. The court provided a statement stating that cryptocurrency can be accepted as a legit payment for legal transactions, but the payment system will be regulated by the Reserve Bank of India.
Banks have informed that they have received a notice from RBI that stated that they should stop any operations that are conducted on crypto.