Crypto investors in India have always been in a dilemma with regard to the legality of these digital assets. Despite including crypto in the country’s latest budget, the lawfulness of crypto continued to remain frail. Adding to the already brewing uncertainty, the deputy governor of the Reserve Bank of India [RBI] was rooting for a ban.
Cryptocurrencies grew from being an instrument for illegal activities all the way to a trillion-dollar industry. Just as crypto is finally gaining the recognition it deserves, governments across the globe were seen either regulating the industry. A few others like El Salvador were embracing the crypto-verse by legalizing Bitcoin. India wanted to be a mere spectator as most of the individuals from the government were pushing for a ban.
Speaking at the Indian Banks Association 17th Annual Banking Technology Conference and Awards, the Deputy Governor of the Indian central bank, Rabi Sankar compared cryptocurrencies to Ponzi schemes. Therefore, he was inclined towards banning the crypto-verse instead of regulating it.
Further elaborating on cryptocurrencies Sankar added,
“Cryptocurrencies are not currencies, financial assets or real assets, or even digital assets. Therefore, it cannot be regulated by any financial sector regulator. It is not possible to regulate something that one cannot define.“
Mirroring the thoughts of RBI’s Governor Shaktikanta Das, Sankar suggested that cryptocurrencies had the ability to disrupt the already established monetary stability of a country. He further pointed out the chances of crypto posing a threat to the Indian Rupee as its utility could be reformed following regulations.
India and its love-hate relationship with crypto
The RBI time and again expressed distress over cryptocurrencies. However, the Finance Minister of India restored hope by making crypto-friendly announcements. However, the latest move of the government revealed that the country was traversing towards a ban.
A 30% tax on crypto profits angered the entire market. As Indian crypto traders continue to combat this extensive tax band, Finance Minister Nirmala Sitharaman dropped a bomb regarding the legality of crypto.
Recently, Sitharaman pointed out that taxing crypto did not mean they were legal in India.
With an array of politicians and bank officials yearning for a ban, the chances of crypto being legal in the country were far-fetched.