Will India ban crypto-currencies? – The National

Shivam Thakral of New Delhi was worried when he heard a government panel propose to ban cryptocurrencies in India.

As a co-founder and general manager of the cryptocurrency exchange, BuyUcoin, such a move could spell the end of his business.

"It's pretty regressive to see this kind of recommendation from the panel," says Thakral, whose platform, created in 2016, allows users to trade crypto currencies such as Bitcoin.

"More than us, I worry about people who have invested their hard-earned money in cryptocurrency," he said.

As in other parts of the world, investors in India have shown renewed interest in virtual currencies in recent years, largely because of soaring prices.

A ban would prevent the deployment of new applications and solutions and discourage technology start-ups.

Nbadcom, the Indian body of trade in information technology

Bitcoin prices have risen again this year, reaching about $ 10,800 (MAD 39,667), compared to about $ 3,700 at the beginning of the year. Although still at the highest level the $ 20,089 reached in December 2017.

The Indian authorities are wary of virtual currencies, discouraging even people from investing in them, evoking financial and security risks.

The latest proof of their warning was made last month, when a government group proposed a bill to ban cryptocurrencies, providing for prison sentences of up to 10 years and fines of up to 250 million rupees (13.2 billion dirhams) for anyone using virtual currencies.

The bill would make it illegal for any cryptocurrency in India to be unregulated by the government.

Bitcoin, Ripple and Ethereum would be among the cryptocurrencies concerned, if the bill has become a law.

Vikram Pandya, FinTech program director of the SP Jain School of Management in Mumbai, said that digital currencies were starting to lose popularity in India because they did not have the support of the government. The bill "served as the last nail in the coffin". .

He said that "many exchanges over the last few months have come to an end operations, citing reasons such as unsustainable operations and an unfavorable regulatory environment ".

However, it is not clear if the ban will come into effect.

The panel, led by Subhash Finance Secretary Garg has written a report that will be studied by the government and regulators. He also suggestss the creation of an official cryptocurrency, the digital rupee, to replace the private virtual currencies.

Indian Finance Minister Nirmala Sitharaman appears to support the group's report.

"If I compare several other countries where this type of study was done on cryptocurrencies, we have done very well," she said. Economic time newspaper. "It's a very futuristic and well thought out relationship."

But many do not agree.

Nbadcom, India's IT Trade Organization Thursday condemned the proposal, saying that "the ban on cryptocurrencies is not the solution".

Instead, the group says that a regulatory framework needs to be developed to monitor and govern the sector.

"A ban would prevent the deployment of new applications and solutions and discourage new technologies," said Nbadcom. "This would prevent India from participating in new use cases offered by crypto-currencies and tokens."

The group adds that "the regulation of cryptocurrencies would allow law enforcement agencies to be better equipped to understand these new technologies and to collect information on developments in crime and to take coercive measures".

Another The concern is that, if a ban is implemented, the cryptocurrency trade would go into the shadows as this will 'only deter legitimate operators,' Nbadcom said.

The Indian Ministry of Finance has expressed its skepticism to clear crypto-currencies, calling them a "Ponzi scheme" and stating that they do not have "legal tender". He also warned the public that prices are determined by speculation and are not supported by underlying badets, making them extremely volatile.

Cryptocurrency investors in India instead I think the government's proposal is not justified.

An investor called "Gabru", who founded an online community of enthusiasts called IndiaBits, says he is "disappointed that we do not have the right to choose our rights". He holds cryptocurrencies, including Bitcoin and Ethereum.

Gabru says that he always buys crypto-currencies and will wait to see what will happen with the bill. He remains optimistic that the government "will see the potential of cryptography badets and regulate it appropriately". Nevertheless, he does not want his identity to be revealed "during such tense periods".

A survey conducted by IndiaBits among 1,300 respondents in India found that 62% of them own Bitcoin, making it the most popular cryptocurrency. Ripple is the second most popular pledge, held by 14% of respondents. In response to a question about how they would be affected by a banabout 84% said they would lose a lot of money. 36% said their work was related to cryptocurrencies and that they would lose their jobs or close their doors. Business.

India is not the only one to worry about crypto-currencies. Overall, the speculative nature of investments has raised concerns. In 2017, China banned Bitcoin exchanges, but it is not illegal to hold virtual currency in the countryside. South Korea plans to ban the virtual money in the middle of a craze in the country for chips, but in January 2018 the government took the least extreme step to ban the use of anonymous bank accounts for the Cryptocurrency trading to prevent money laundering.

Facebook's decision to launch a The digital currency called Libra in June, revived the discussions on crypto-currencies around the world.

The Central Bank of India, India's central bank, has repeatedly warned the public against the risks of investing in and took its own measures to limit these investments. Last year, the RBI led the Indian banks stop dealing with cryptocurrency and traders.

"This is thed to a gradual decrease in cryptocurrency in the country, "says Pandya. According to him, the Indian authorities have good reason to ban virtual currencies.

"Once the money is converted into cryptocurrency, there is no surefire way to ensure your customer's compliance or determine end-use," says Pandya. "Given the threat posed by black money and terrorism, I do not see crypto-currencies benefiting from legal support in India."

Kishan Sundar, vice president of digital technologies at Maveric Systems, a technology provider for the banking sectors, and FinTech, based in Chennai, said the introduction of a regulation would help trace any illegal activity. But given the government's concerns, it may not be the way New Delhi is going, he said.

"I think it can go both ways: to adopt regulations or ban them altogether," Sundar said. "Technology continues to evolve, as well as our ability to accept it, That's why I can say that this ban can probably go forward, but that it could also be changed in the future. "

Mr Thakral, meanwhile, hopes that a ban will not be pbaded, but agrees that a regulation is needed. However, he says that there must be a limit to the number of checks that authorities have on cryptocurrency, so as not to defeat its very purpose.

"The popularity of cryptocurrency is due to its technology that allows users to fully control their money without the participation of any central authority," he said.