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There have been rumors about the Government of India and the Reserve Bank of India looking into the prospect of banning Cryptocurrency in India.
The government has been in favor of India Banning Cryptocurrency, but the lack of international crypto support has made it difficult to implement. Finance Minister Nirmala Sitharaman reiterated the need for international collaboration to make India’s ban on crypto real.
Many major countries across the globe have shown complete favor to cryptocurrencies. Some popular brands have even started accepting cryptocurrencies as a method of payment. Crypto is becoming an important part of daily life in many countries. However, for India, things seem to be not going great.
This begs the question of why is India banning crypto. and what happens if India bans crypto?
We will be answering all these questions for you
Why Is Indian Government Banning Cryptocurrency?
The government of India is looking to ban cryptocurrency holding and trading in India. In the latest India banning crypto news, Finance Minister Nirmala Sitharaman considers cryptocurrencies to have a destabilizing effect on India’s fiscal and monetary stability.
India had put into place taxation on all transactions and profits. This move was considered the first step into formally recognizing cryptocurrency as an asset and embracing this new technology. However, the government now seems to be moving in away from it and rather made a plan for India to ban private cryptocurrencies.
India considers cryptocurrencies to be a weapon that could be misused for funding terrorism and could be exploited to hide black money or undiclosed income. Clearly, the Indian Government is banning cryptocurrency soon to control black money, mitigate terrorism funding and increase India’s monetary stability.
The prospects and future possibilities of crypto are unparalleled, but for now, it looks like the Indian ban on crypto will soon be real.
Can India Ban Cryptocurrency?
Cryptocurrencies are not run by any government or particular organization. By nature, cryptocurrencies are decentralized. which means they are hard to regulate. So, India cannot ban cryptocurrency completely.
Instead of India banning cryptocurrency, India can put taxes and restrict the trading and holding of crypto for Indian citizens. They do not have any control over crypto on a global level.
India had also declared 30% taxes on profits made from crypto assets.
India already has many crypto investors and huge amounts of money put into crypto. Along with providing 50,000+ jobs, crypto has also allowed for fast, cheaper international transactions, and allowed easy methods to transfer money for small transactions.
When Will India Ban Cryptocurrency?
India needs a lot to figure out before having a proper ban on cryptocurrency. Since cryptocurrencies have received support at a global level, it would allow Indians to use illegitimate means to access the crypto market.
For a long time, India has treated crypto income similar to gambling and similar activities. RBI had planned to launch its own cryptocurrency as well. However, things have been going back and forth for a long time.
Back in 2018, India had banned all #cryptocurrency transactions, however, the #CryptoBan decision was reversed by India’s apex court.
Considering the unhappy investors, the prospect of illegitimate means of crypto trading, and the unfavorable decisions from the Supreme Court, the Government would have to be slow and very careful to ensure everyone can be
What Happens If India Bans Crypto?
India has many crypto investors and having an abrupt ban would surely bring up lots of problems for them. As an immediate consequence, purchasing of new crypto would be immediately stopped in India.
Existing crypto owners/investors might be given a window to trade their crypto and sell it, but the window won’t be very long.
As a ripple effect of the crypto ban, popular crypto exchanges in #India, like WazirX will diminish. Mass layoffs of employees in Indian crypto exchanges is very likely if India bans crypto.
Besides, Crypto ban in India would also result in the crypto market crashing on a global level. This is because, India controls a lot of wealth and trade in crypto, loosing all Indian #crypto traders would reduce price of all cryptocurrencies.
Conclusion
The prospect of India banning cryptocurrency could be real very soon. India wants to control terror funding and black money by banning cryptocurrency in India. India has not banned cryptocurrency yet.
However, India’s ban on crypto would be tough to implement as cryptocurrencies are completely decentralised. Besides, many traders and investors would be upset with crypto ban, so government would have to do proper provisions to minimize their losses.
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