India Considers Cryptocurrency Ban

The Government of India Considering a ban on virtual currencies. A new bill bans not only the possession, but also the trading and mining of cryptocurrencies. At the beginning of this year, there were also rumours about a possible ban. The government wants to make more room for new digital central bank money.

If the government passes the bill, India will be the first major country to ban the ownership of virtual currencies as well. In China, legislation already exists that regulates trade and Mining of virtual currencies Prohibits, but the possession of crypto is still allowed there. The new bill would give the Indian population six months to sell all crypto positions.

Flight to virtual currencies

The price of virtual currencies has risen unprecedentedly in recent months. At the time of writing, a Bitcoin is approximately $58,000 while Ethereum's price is at around $1,800 state. Since the beginning of this year, the price of many virtual currencies has more than doubled, driven by speculation and institutional parties getting on board. For example, Mastercard Bitcoin to its network and has Tesla recently bought $1.5 billion worth of Bitcoin.

Interest in virtual currencies is also increasing rapidly in India. It is estimated that more than 8 million people in India have already Wallet with cryptocurrency. This Wallets would contain an estimated $1.4 billion worth of crypto coins. Despite the prospect of a possible ban on the possession of virtual coins, Indians continue to get in. Major exchanges are seeing CNBC an influx of new users. At the platform bitbns, the inflow of money and new users is now thirty times as large as a year ago.

The price of Bitcoin has doubled in a few months (Source: Coindesk)

Imprisonment?

The Indian government does see a future in blockchain technology, but would like to maintain control over the money system. That is why the government is trying to restrict the use of virtual currencies in the free market. Instead, it wants to put its own digital central bank money into circulation in the long term, although it is not yet clear when that technology will be ready.

In 2019, the government of India had even stricter plans regarding banning crypto, such as imprisonment for up to 10 years for people who own, trade, or trade virtual coins. Mining. It remains to be seen whether these sanctions will actually be implemented. In 2018, India's central bank tried to ban the trading of virtual currencies by banks, but that ban was declared illegal by the Supreme Court. The judge ruled that the government had to draw up new legislation on this.

As long as virtual currencies are not banned in India, more people will try to buy or buy virtual currencies. Mining. It is very difficult for the government to find out the identity of users, while it is very easy to send virtual coins to another account in another country. A ban on cryptocurrencies will have the effect of preventing companies that offer cryptocurrencies or to do so on a large scale Mining have to close their doors.

This contribution comes from Geotrendlines