The long history of cryptocurrency legalization in India
In 2020, India was particularly undecided with regard to the laws applying to the cryptocurrency sector. The year had started with good news for local users: the Indian central bank said in January that cryptocurrencies were not banned. In March, the Supreme Court even had overturned a central bank decision, which specifically prohibited cryptocurrency trading.
But the lull had been short-lived for traders. In June, we learned that the Indian Ministry of Finance was preparing a law to ban cryptocurrencies in their whole. It planned to threaten crypto users with up to 10 years in prison, and a fine of up to $ 3.2 million. And it is this more restrictive current that once again seems to have the upper hand in the start of the 2020 school year.
👉 Read more: Indian Supreme Court overturns restrictions on cryptocurrency
Illegal cryptocurrency trading in India?
New information reported by Bloomberg indicates that it is now cryptocurrency trading that would be targeted again, 6 months after being cleared. The bill must be considered before being sent to Parliament. The government would like to encourage blockchain and the technological developments it can bring… But not the cryptocurrencies linked to it. If this law were approved, it could affect 1.7 million local users, which had grown in numbers since India showed signs of opening up to cryptocurrencies.
👉 Follow all the news of the regulation of cryptocurrencies
The crypto community in expectation
According to Bloomberg, the advance of last March had indeed sparked a cryptocurrency rush in India. Trading increased by + 450%, in particular on P2P exchanges. Paxful reported growth of + 833% in India from January to May 2020. The opening had also not escaped Binance, which had started its expansion in the Indian market. In addition, the cryptocurrency giant had joined a local association last August in order to stand together against the reluctance of lawmakers.
This bill could therefore new throw back the crypto community of india. It also shows the dilemma of some countries, which wish to promote the blockchain without giving too much ease to cryptocurrencies. China has been playing this balancing act for several years now. But if the months of freedom for Indian traders have shown one thing, it is that the population is now interested in cryptocurrencies, in particular. in an uncertain economic context. It is therefore doubtful that a ban on cryptocurrency trading is effective in India.
👉 Also read: Binance and WazirX unlock $ 50M for Indian blockchain startups
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About the Author : Marine Debelloir
Intrigued by Bitcoin for several years, I developed a passion for crypto-currencies and the innovative technologies that result from them. I like to unearth the most delicious information to share it with you and help democratize this fascinating universe. But I don’t stop there! I also like to analyze projects related to cryptos and blockchains, which fascinate me just as much.
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