In India, the question has been asked for a long time whether and in what form the government could ban crypto currencies. Now plans for such a ban are becoming more and more concrete.
On February 11, 2021, media company Bloomberg had a conversation with an anonymous source
This claimed that the Indian government was planning to ban cryptocurrencies altogether soon. According to his own statement, the source is a high-ranking official from the Indian Ministry of Finance. In the near future, the government should want to introduce a crypto ban by law that completely forbids the use of crypto assets. The government wants to create a framework for an official digital currency, which is issued by the Indian central bank “Reserve Bank of India” (RBI). However, there would also be some exceptions, as the Indian Parliament, Lok Sabha Bulletin stated:
The bill also seeks to ban all private cryptocurrencies in India. However, it makes certain exceptions to promote the underlying technology of the cryptocurrency and its uses.
During the conversation, the anonymous source spoke of a transition period before the law comes into force. According to this, crypto investors would have three to six months to convert their crypto assets into fiat currencies. However, the said transition period does not change the fact that the impending ban is of great concern to many supporters and owners of cryptocurrencies in India. One of them is Sathvik Vishwanath, co-founder and CEO of the Indian trading platform Unocoin:
If the government bans all cryptocurrencies except the state-backed CBDC, it doesn’t make sense to continue our business in India. But we have to wait and see.
The crypto ban had already been announced
As early as August 2020 , the Indian government announced that it was working on a crypto ban by law. A time when India experienced a real crypto boom. The Indian central bank „Reserve Bank of India“ (RBI) had long been a thorn in the side of cryptocurrencies. In 2018, RBI had banned private crypto currencies for the first time. However, in March 2020, the Indian Supreme Court lifted this ban. Influential investor houses such as JPMorgan were in favor of Bitcoin and other cryptocurrencies at the time. Large payment service providers such as PayPal later adopted Bitcoin as a payment method. Recently, MasterCard also announcedWanting to introduce payments with cryptocurrencies. When exactly the ban on cryptocurrencies in India will come into effect remains to be seen.