One of the fastest-growing markets for the crypto industry, India’s limit on its currency convertibility, the Rupe, makes Bitcoin trading impossible by the government.
The central bank has cleared the fact that they want every cryptocurrency to be banned in India while they develop their digital currency.
However, the exception is, the Indian government is still moving forward to promote blockchain technology.
According to Chainalysis, the Indian market rose by over 641% from July 2020 to June 2021. Majorly focusing upon central and southern Asia, it contributed as one-fourth of the total market with a worth more than $572 billion or 14% of the global transaction.
Around $10 million worth was transferred representing 42% of the transactions from India-based addresses. The remaining 28% was from Pakistan and 29% from Vietnam. This shows the high Indian market, and also the young technical community.
Let’s Understand What Is Bitcoin
Bitcoin is a form of cryptocurrency that is decentralized in nature and keeps on fluctuating in terms of price worth. The digital asset is available on a public ledger named Blockchain.
Blockchain technology holds crypto transactions and is advancing with the growth and development of the global market too. Other than bitcoins, there are several types of cryptocurrency such as Bitcoin and Ethereum that vary in price.
Another important thing to know about bitcoins and other cryptocurrencies is that they are secured by a software coding system known as cryptography.
In a whole new world of digital payments, cryptocurrency transactions are recorded on the blockchain and can be accessed through a private key, generated only for the owner. If leaked, it may lead to serious cyber scams and attacks.
The new Bitcoin era and the rise of these online transactions signify the movement of money without any physical transfer, giving rise to a new digital era.
India’s Rules And Concerns Towards Bitcoin
India’s relationship with bitcoins is not rigid, existing in a grey area. India banned cryptocurrency transactions in 2018, however, the rules were reserved by the Supreme court in March 2020.
This led to the urgent need and emergence of strict laws with respect to the rising concerns that an unruled space could attract more domestic home savings towards bitcoin which led to a crash for average savers, making them vulnerable. Recent analysis has shown the launch of a new bill for Indian investors.
The concerns showed were related to the threats bitcoin may lead to the nation’s macroeconomic and monetary stability. Another reason is the partial conversion of Indian currency – rupees.
Along with this, issues such as money laundering and financial terrorism were also raised. Cryptocurrencies are needed to be traded in a free environment with no authority control and taxes.
The government of India is planning to launch a bill named “The cryptocurrency and regulation of official digital currency bill, 2021″ aiming to provide a facilitative framework for the development of digital currency and other assets.
The bill is set to launch in the upcoming winter session of the parliament, paving the way for an official digital currency launch for India. The Reserve bank of India will be issuing an authorized cryptocurrency.
Reason For The Upcoming Bill
With the use of contemporary technology, Cryptocurrency makes sure to secure payments and transactions. Blockchain technology makes it easier for investors to rely upon crypto trading with the right techniques.
However, the RBI is consistently opposing the digital asset by giving reasons for threats, cyber-attacks, risks and scams.
It also stated that cryptocurrency can become a major threat to the currency system of India and the authorized banking mechanism.
Along with this, money laundering was another major reason given by the authority. This led to people raising the idea and emergence of a private cryptocurrency for the nation.
The crypto trader software is rising however it holds some challenges with a lot of countries. With the hype of high-value profit comes a great set of cybercrimes that discourages users from investing in these digital assets.
The emergence of a private cryptocurrency for India may give a boost to the global market and a speedy rise in the digital era.
With this may come a new set of rules and regulations for the safety and security of crypto users, all under the supervision of the Reserve Bank of India.