Responding to a headline about Bitcoins trading on a $500 premium in Indian markets, Changpeng Zhao, the CEO of top cryptocurrency exchange Binance, has tweeted that the Indian government’s decision to ban crypto is likely to have increased the appeal of Bitcoin to the general populace, who are now ready to pay a price much higher than the actual market price to get their hands on the surging asset.
India has been on the news lately for formulating an anti-Bitcoin bill, that threatens jail sentences to people caught with crypto assets in their possession.
The Binance CEO, or CZ, as he is affectionately known in the crypto circles, took to his widely followed Twitter handle to criticize the country’s decision. He wrote:
The more it is “banned”, the more people want it.
He linked an article that reported how Bitcoin was being sold at a premium in the country in the wake of the ban. The price of Bitcoin in India has gone well over 8 lac Indian rupees on Bitbns, one of the few exchanges that are still operational in the Draconian crypto environs of the country.
Premiums are not anything new in the world of crypto. In fact, last week itself, it had been reported that Bitcoin was being sold at a $160 premium in a Hong Kong exchange.
However, the circumstances in India seem to be singularly strange as the government repression seems to have sent the Bitcoin premiums soaring up to the skies.
This seems to be a reflection of the classic laws of demand and supply, with restrictions and lessening of ways to buy Bitcoin in the country giving rise to a disparity between the supply and the demand. As a result of the supply being low vis-a-vis the rising demand, the price seems to have gone up.
With the Indian Supreme Court yet to give a verdict, the Indian crypto scenario seems to be in a disarray. As of now, it seems to manifest clear effects of the Streisand Effect, where something grows more as a result of people trying to suppress it.
Whether or not the situation improves will depend on the attitude of the Modi government, which seems unlikely to soften its stance regarding decentralized assets anytime soon.