As a market or as the developer, India is one country which has always integrated technological innovations in its framework. In the year 2017, the contribution of Information Technology (IT) sector in the gross domestic product (GDP) of the country stood at 7.7%. For the technology industry to grow further in India, it is critical that the country embraces emerging technologies such as Blockchain Technology and cryptocurrencies.
While India has been accepting of distributed ledger technologies, its stance on digital currencies is still not clear. If you are a crypto enthusiast, then you must wonder if cryptocurrencies will be legalised in India. Let’s see if the future is bright for the crypto community in India.
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India is the second most populous country in the world, only to come after China. As per the global cryptocurrency benchmarking study carried out in the year 2017, among the countries in Asia, India is one of those that have witnessed increased volumes in crypto trading. The adoption of cryptocurrencies and the technology of Blockchain that underpins them is ever-so critical to address the needs of India’s evolving economy. Yet, the crypto industry in India lags behind its Asian counterparts.
What ails the crypto economy in India is the lack of clarity about the regulatory frameworks from the government. Crypto trading is still not officially legalized in the world’s sixth largest economy. The waters got even murkier when the president of the country’s National Association of Software and Services Companies (NASSCOM) said in a statement that NASSCOM considers digital currencies to be illegal in the country. In fact, India is not alone; many countries are banning cryptocurrencies.
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The CEO of Qupon (which is a global eCommerce marketplace for merchants to advertise digital coupons) Joseph Oreste is of the view that NASSCOM’s stance on digital currency market is ‘unfortunate’ considering such statements and decisions serve as a hindrance to India’s potential contribution in the decentralized world economy of tomorrow. Many are left to wonder if India’s anti- crypto stance is affecting its position in the Blockchain race. Oreste is of the view that the Indian government should take steps towards creating a regulatory framework for the crypto economy.
It is interesting to note that while NASSCOM has made an anti-crypto statement, however, the Indian government has so far not explicitly stated that crypto businesses are illegal in the country. However, NASSCOM’s stance on crypto businesses is not to be taken lightly because the organization has more than 2000 companies from the IT and BPO industry as its members.
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The government’s recent actions also conform to the vision laid out by NASSCOM on the future of cryptocurrencies in India. For example, in October 2018, the Indian authorities apprehended the Co-Founders of the cryptocurrency exchange Unocoin for running Bitcoin ATM operations at a mall in the metropolitan city of Bangalore. That’s not all the famous Zebpay also relocated to Malta after shutting its business in the Indian subcontinent. All this was the aftermath of the policy laid out by India’s central bank, the Reserve Bank of India, which barred financial institutions like banks from offering services to crypto businesses.
The future of cryptocurrencies at the moment remains unpredictable as it is dependent on whether the Supreme Court can lift the ban imposed on financial institutions by the RBI. Potential cooperation between technological advancement and policy making is the only way for India to chart out a bright future for cryptocurrencies in the country because while there may be concerns such as the volatile prices of Bitcoin, digital currencies are the way forward.
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