Victor Ugochukwu · Dec 14, 2020 . 5min read
Indian Government to Introduce Ban on Crypto Trading yet again
After uplifting the crypto ban in India, a draft law to ban cryptocurrencies is ready and will be discussed by the federal cabinet.
By Komal Joshi · Sep 17, 2020 . 7min read
The Indian government is planning a bill that would effectively ban the trade in cryptocurrencies, according to the Bloomberg reports. The federal cabinet will review the bill before sending it to parliament. Last year the Reserve Bank of India issued a circular to regulated entities banning dealings in crypto. This entirely blocked the way for digital currencies. However, the Supreme Court had overturned the decision in March 2020, following suits filed by cryptocurrency exchanges.
According to the reports, the federal government will encourage blockchain, the underlying technology cryptocurrencies. However, it is not interested in cryptocurrency trading. A crypto trading ban could affect a huge number of Indians trading in cryptocurrencies. Additionally, it would attack a rising number of companies setting up platforms for the trade.
Cryptocurrencies as an Easy Way for Tax Evasion
The central bank provided a significant reason behind the decision to ban crypto back in 2018. The central bank had claimed that an alternative payment system could threaten the banking system and its capability to control monetary policy.
People who send money to India are aware that Indian banks expect the reasons for payment. This is utilized to control anti-money laundering and tax avoidance. Keeping tax evasion in mind, once a huge number of users already have wallets within a country, it’s much more challenging to implement a ban unless the penalties are adequate to impart a sense of fear. The very nature of peer to peer trading means that people can move around the money they already have. There are a prominent number of Indians both in the country and abroad that operate for foreign companies. So providing an unmonitored route for payments could also impact tax receipts.c
The crypto ban will affect various companies that decided to expand their crypto ventures in India. For instance, Cashaa recently shared its intentions to expand in India, the U.S., and Africa. Cashaa, a London-based crypto-friendly banking platform, raised $5 million from the Dubai-based blockchain investment and advisory firm, O1ex, to launch neo banks.
India Ventures in Blockhain and DeFi Ecosystem
However, India is exploring the potential benefits of blockchain technology. Earlier, Tech Mahindra partnered with Amazon Web Services (AWS) to promote Blockchain technology solutions. Tech Mahindra will offer Blockchain solutions built on Amazon Managed Blockchain to users globally, operating AWS, and other leading organizations worldwide.
Moreover, recently The Indian Institute of Management (IIM) Kozhikode provides three executive programs named advanced management certification in transforming consumer experience with AI and design, blockchain and AI for Fintech, services, and supply chain revolutionization. IIM collaborated with WileyNXT to implement these courses.
India has also ventured in DeFi space. Earlier, Binance declared the launch of “Build for Bharat,” a new hackathon and accelerator program. It intends to promote the DeFi and blockchain ecosystem in India. Build for the Bharat hackathon is a dual-fold program to bridge the gap between mass adoption and blockchain.
Follow Cryptodose for more updates.