India’s Draconian Take On Crypto It Aiming A Blanket Ban?

The Central Bank of India has been displaying strong hostility towards crypto for a very long time now. Ever since cryptocurrency has gained popularity in a nation that inhabits 17.7% of the world’s population, the Reserve Bank of India (RBI) has been eyeing ways to manage the sector.

The RBI governor, Shaktikanta Das, has again expressed severe concerns about regulating the industry. This has kept crypto investors and enthusiasts on their guard because the annual budget date draws closer. The Central Bank of India has now issued a stern warning against using Bitcoin and other virtual currencies.

The situation was aggravated further owing to the crash of FTX. Governor Shaktikanta Das has again and again called crypto an ‘unstable instrument,’ which is ‘nothing but gambling’ as private digital assets hold no intrinsic value in any way.

On the Business Today Banking and Economy Summit, Governor Shaktikanta Das argued that personal digital assets needs to be banned because it holds a ‘make-believe factor.’ He also proceeded to state that crypto is nothing but a ‘100% speculation world.’

Dollarization Of The Indian Economy

The RBI’s governor, Shaktikanta Das, has stressed that the FTX crash has proven how cryptocurrency being a speculative industry is detrimental to the economy. India previously stated that the influx of personal digital assets would cause the dollarization of the economy, which shouldn’t be ideal for the nation.

Das, speaking on the event, echoed the identical sentiments, saying, “Dollarization would increase resulting from rising crypto usage and should act against the country’s sovereign interest.” Not only has the dollarization of the economy concerned India, but so has the regulatory framework for digital assets.

Mockingly enough, despite concerns regarding the identical, India has still not finalized a bill to manage the industry for years now. Quite the opposite, Nirmala Sitharman didn’t suggest a blanket ban on the G20 summit in October; she as an alternative mentioned that India could be aiming to introduce a technology-driven regulatory framework to raised regulate the assets.

The query stays if India’s government is capable enough to manage the industry. All of the animosity towards the industry could be a false front to discourage enthusiasts from staying away from the industry.

RBI has also mentioned that personal digital assets might cause ‘financial instability’, together with announcing that if private virtual currencies are allowed to operate within the country, the RBI “may likely fail” to watch these transactions.

Das added:

Crypto masquerading as a financial asset is a very misplaced argument. Our country doesn’t promote gambling.

Calling crypto a type of gambling doesn’t take away the main target from the incontrovertible fact that the Indian government has in actual fact admitted to not laying the right rules for governing the asset. It’s yet to be seen if India can work out a regulatory framework to raised scrutinize digital assets before the annual Union Budget of 2023.

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