India, through its central bank, is on track to place an outright ban on the crypto market while planning to introduce its digital asset. According to a statement released by the Reserve Bank of India, the crypto industry is too volatile to be accepted by the government because it can lead to financial instability. This is contained in a publication released by Bloomberg.
The Central Bank governor said the crypto industry left a lot to be worried about, saying that the RBI had explained why cryptocurrencies had to be banned to the government. This announcement is part of the series of statements the Indian regulatory authorities have issued to justify the ban’s reasons.
Indian Government to Launch its Digital Currency
Recently, the regulatory authorities recommended that the government issue an outright ban on any crypto holding its transaction. Meanwhile, the Indian government is now considering launching a government-backed digital currency issued by the central bank.
The central bank governor, Shaktikanta Das, also confirmed that introducing a digital currency is in the offing. He said his team had commenced the technical and other aspects of the processes. The Indian Regulatory Authorities Orders Firms to Sell Their Crypto Holdings Before Raising Funds Through IPO.
India’s highest authorities on securities are unrelenting to see that company’s top managements sell their crypto holdings and do not use investors’ funds to trade or invest in cryptocurrencies. While the clampdown is ongoing, crypto supporters insist the government is wrong to prevent them from holding or investing in cryptocurrencies. In recent years, crypto legal practitioners have formed a union to collaborate with the government to establish an enabling environment for the crypto industry.
Any Fintech is Susceptible to Misuse
Not all top government officials are in support of the ban. One of those opposing the government’s blanket ban on crypto is Dr. Srivata Krishna of the Indian Administrative Service, who insisted that users can misuse or manipulate any technology to their advantage. He frowned at the Indian regulators’ negative attitude and drastic policies towards the crypto industry. He advised the government to benefit from the evolutionary way of wealth creation brought by the crypto industry. He said the government was trying to be on the safe side but did not understand the nature and inherent opportunities present in the crypto space.
A top finance ministry official has reiterated the government’s stance on the outright ban on cryptocurrencies. This follows the ongoing bill that will soon be presented to the Indian parliament. An anonymous official revealed this to Bloomberg. In 2018, India prohibited all banks, both public and private, from doing business with crypto exchanges. However, the order was overruled by the Supreme Court. Unfortunately, the court ruling was short-lived as the government continues its anti-crypto policies against the people.
At present, the Bitcoin price is hovering around $50,000. The digital currency jumped to an all-time high following Tesla’s $1.5 billion investment in Bitcoin. While many people worldwide are benefiting from the surge in cryptocurrencies, the Indian government prohibits its citizens from partaking in the boom.