India to ban the use of cryptocurrencies

Crypto physical wallets

Last September China banned all cryptocurrency trading, and it looks like the next country to follow suit happens to be India, with regulations that could come into effect early next year.

After banning cryptocurrencies, China introduced its own official digital currency, something that could happen in India as well

From government bodies, different arguments are wielded to support this ban. One of them is the ease (given the anonymity associated with cryptocurrencies) that these digital assets can serve for money laundering and to finance criminal activities.

Another would be the high risk to the economy of those who are investing in this type of digital assets, highly volatile and susceptible to fleece those who entrust their savings in financial products that are not backed by the activity of companies (such as shares) or by the states themselves (such as bonds).

In this regard, attention has been drawn from the Government to the extensive advertising campaign on cryptocurrency-related activities that is being developed in the country, using popular faces from the successful local film industry, which would be influencing extensive layers of society.

On November 29th, the Indian parliament will resume its activity and from then on the negotiation and processing of a regulation promoted by the Government of the country will begin, which is expected to be approved in January. From that moment, and if the regulation is maintained in the announced terms, it would be prohibited both mining (process of “generation” of cryptocurrencies) and any type of negotiation or operation with digital currencies.

It appears that there would be only two caveats to this prohibition the Indian state would have its own official cryptocurrencybacked by the country’s central bank, which would be authorized, and exceptionally and meeting certain requirements that have not yet been specified, could authorize certain companies that could carry out certain operations with cryptocurrencies, always meeting requirements that seem to be strict and demanding.

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