BENGALURU: India’s proposed law to criminalize possession, trading and mining of digital currencies like Bitcoin at a time when crypto assets are rallying at an all-time high is a cause of worry for the investors community.
The country’s tryst with cryptocurrency has been a rather turbulent one with the Supreme Court in March, 2020 striking down a RBI ban on digital assets. The government is now reportedly planning to introduce a bill to ban all forms of cryptocurrencies and introduce a new digital asset citing the risks to financial stability.
The proposed law is also likely to penalise bitcoin or any other cryptocurrency holder, in what will be one of the toughest regulations surrounding digital assets globally, say experts.
However, Finance minister Nirmala Sitharaman allayed some fears stating that not all windows will be shut for cryptocurrencies and that the government will take a very calibrated position on the matter.
“We are confident that a positive move at this point can unleash a host of opportunities for our country including the attention of high-profile global investors and technologists that can offer us the right backing in our pursuit to becoming a global power,” said Sumit Gupta, CEO and co-founder of crypto exchange CoinDCX. At a time when Bitcoin has almost doubled its valuation in a year at over $60,000, and has been endorsed by Tesla CEO Elon Musk and Twitter chief Jack Dorsey, among others there is a strong FOMO(fear of missing out) sentiment amongst investors in India. Data sourced from Internet & Mobile Association of India showed trading volume daily for digital currencies in India is between $300-$500 million.
A Bengaluru-based blockchain enthusiast, Dhiren Dukhu, also told this publication that retail investors, who can take the risk with the price volatility of cryptocurrencies, should be allowed to invest. “Cryptocurrencies are a global phenomenon and here to stay. Instead of selling my coins, I’d prefer to send them abroad to a friend for safekeeping I don’t want to lose on this rally.”