Any effort to deny the future and evolution of the world in order to stick to more traditional and previously proven reliable business practices can only lead to one’s quick demise. India was previously considering implementing a blanket ban on all cryptocurrencies, as their high volatility and being a fiat currency has led to much skepticism in using them in legitimate business transactions. However, Finance Minister Nirmala Sitharaman announced that the government and Reserve Bank of India are amidst discussions towards allowing fintechs to experiment with cryptos on a large scale throughout the national economy. Sitharaman, and India in general, are acknowledging that the world’s technological advancements are happening extremely rapidly, and it would be very unwise to not be receptive to that. On top of this, India has actually been one of global fintech’s shining beacons, as many other countries have looked towards India for inspiration while considering their own domestic fintech strategies.
As are many other countries entering the global fintech and cryptocurrency world, India wants to create a large lead but is taking the time to ensure there is safety and proper regulations instilled before progressing. To detail this, the Cryptocurrency and Regulation of Official Digital Currency Bill was drafted earlier this year. The synopsis of the bill reads, “To create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India. The bill also seeks to prohibit all private cryptocurrencies in India, however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses.” For the time being, the bill doesn’t seem to be being discussed during the continuing session of Parliament.
One of the primary objectives of the bill is to ban all private cryptocurrencies, such as bitcoin and etherium, and only allow those that are created and regulated by the nation. Although having a crypto market is better than not having one at all, this is a huge roadblock for not only citizens in India that would like to use and invest in those currencies, but the outside world that may want to make transactions in India using them. It has been suggested so far that anyone in India who currently owns any of these currencies will need to get rid of them within the following three months. Despite this hurdle some investors may face, the overwhelming consensus seems to be positive in regards to the statement to authorize cryptos as opposed to an entire ban.