The fate of cryptocurrencies in India seems uncertain at the moment. Since the Narendra Modi-led government announced its plans of tabling a cryptocurrency bill in the Parliament’s winter session, Indian crypto investors have been nervous. After all, the bill is set to ban private cryptocurrencies and lay down the framework for the creation of the Reserve Bank of India’s very own Central Bank Digital Currency (CBDC). The Reserve Bank of India has also stated that a partial ban on cryptocurrencies won’t be effective in the long run.
According to the co-chair of BACC, Ashish Singh, the classification of cryptos should be asset class. Singh pointed to the fact that similar regulations on crypto exist in several other countries. He also added that the majority of crypto use cases are as investments, not as payments. Shivam Thakral, the CEO of BuyUcoin, said that the Indian crypto industry is fine with regulations if those regulations only stop it from being recognized as legal tender.
However, what happens next is purely down to the Indian government’s definition of ‘private’ cryptocurrencies, which isn’t clear so far. Another worry for Indian crypto players is the role of the Reserve Bank of India, which has been completely against cryptocurrencies for a long time.
Even though the Indian crypto market has exploded in recent years due to the establishment of numerous crypto companies, the government’s stance towards crypto has generally been unfavorable. Narendra Modi, the Prime Minister, has stressed on the need to regulate cryptocurrencies to stop them from being used to fund illegal activities.