The news of the government introducing a Bill in the Parliament to prohibit all private cryptocurrencies in India, barring a few exceptions to “promote the underlying technology of cryptocurrency and its uses”, has hit like an asteroid in the crypto world. The impact of this was clear this morning, where all the major cryptocurrencies saw a fall of around 15 per cent or more.
Bitcoin was down by over 17 per cent, Ethereum and Tether (major cryptocurrencies) falling by close to 15 per cent and almost 18 per cent, the anticipation of the government clamping down on crypto has affected around two crores Indians who have invested in cryptocurrency. The Bill that will be given final consideration in the winter session is to prohibit all private cryptocurrencies in India with certain exceptions.
Meanwhile, the government has announced that the Reserve Bank Of India will issue its digital currency. The Centre didn’t explain what this does or how it will function but explained the objective is “to create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India.”
The government has been worried about the increase in investment in Cryptocurrencies. On November 16, the Parliamentary Standing Committee on Finance, chaired by Bharatiya Janata Party leader and former union minister Jayant Sinha, had met representatives of the Blockchain and Crypto Assets Council (BACC), crypto exchanges, and industry associations, among other stakeholders.
All parties at the meeting concluded that cryptocurrency could not be stopped but concluded that it must be regulated. However, there was no clarity on one of the main concerns that industry associations and stakeholders raised on what will happen to the cryptocurrency already in circulation.
However, Crypto experts are still hopeful that the government will not go for a complete ban on cryptocurrencies. Investors think that the future of cryptocurrencies lies in the Centre of recognising crypto as an asset, similar to real estate, stocks or gold.
According to a CoinDCX spokesperson, “A well assessed and thought through regulation would pave the way for greater adoption of the technology and will help millions of Indians embrace this new age asset class. We are looking forward to the next steps on this.”
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