Indian Government plans to introduce a law to ban cryptocurrency trading
By Max Steadman – Cryptocurrency Speculator
India aims to enact a new law that will soon ban trade on cryptocurrency exchange platforms, removing India from the list of Asian economies who are developing and maximizing on the growing digital markets.
According to people working with part of the Indian federal government but who wish to remain unidentified, the bill is likely to be debated in the near future by the Federal Cabinet before it is sent to Parliament. The spokesperson for the Indian Ministry of Finance did not act in response to our enquiry and did not comment further. According to two sources, the federal government will continue to promote blockchain, the technology that underlies cryptocurrencies but does not support cryptocurrency trading.
India's decision will be essential as more Asian nation countries consider the economic benefits and concerns regarding digital currencies. Rival China, which outlawed initial coin offerings (ICO’s) in 2017, recently permitted Bitcoin trading as a virtual asset property rather than as fiat. They are also building their own Central Bank Digital Currency (CBDC). In Asia crypto trades are currently regulated by both Singapore and South Korea.
It is worth noting that the renewed trading ban could adversely impact more than 1.7 million Indian users looking to buy and sell cryptocurrency and who trade in digital assets. This is also expected to affect an increasing number of businesses setting up trading platforms and entering the cryptocurrency space.
It will also affect companies such as Singapore-based CoinSwitch, which added 200,000 users after launching operations in India in June and reported volumes of around $200-300 million, according to Chief Executive Officer (CEO) Ashish Singhal.
Sanjay Khan, Partner at Khaitan & Co, a New Delhi-based lawyer who offers business advice, said that India needs to do the opposite, citing that they should implement a legislative and governing framework to help protect retail consumers. He adds that "India will potentially benefit from such a regulation to draw cryptocurrency investors and businesses." This stance echo’s that of the UK FCA which has banned the trading of cryptocurrency derivatives for retails consumers.