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However, India’s crypto ban may just be another ‘FUD’ meant to create fear in the crypto industry.
Amid talks of a crypto ban in India, a new report by an Indian business magazine suggests that the government may block IP addresses belonging to crypto exchange to implement the ban. However, the same source indicates the action could only fuel illegal activities as more people use dubious methods to access digital assets.
Although the bill has not yet been tabled, the Indian government has not been very receptive to the cryptocurrency industry in the past. The Indian government has been a huge proponent for a government-backed digital currency.
India not only holds the second most populous nation but also an emerging tech-oriented youth group. It has previously been reported that a huge number of unemployed youths in India have turned to cryptocurrency trading and investing to earn income and make a living out of it.
Proposed India Crypto Ban
Banning cryptocurrency trading and other related activities would be a huge blow not only to the Indian population but to the whole crypto ecosystem. In the past few years, major institutional investors who are focused on the blockchain and crypto industry have eyed the Indian market. Among them are crypto exchanges, payment platforms, and also Facebook Inc (NASDAQ: FB) through its subsidiary WhatsApp.
Cryptocurrency-oriented platforms have pleaded with the government not to ban the industry but rather regulate it to attract more investors. Besides, other major global economies have embraced the crypto industry through regulations.
Earlier this year, Minister of Finance and Corporate Affairs Nirmala Sitharaman, noted that the country will remain open-minded to emerging technologies to improve on existing financial systems. “From our side, we are very clear that we are not shutting all options. We will allow certain windows for people to do experiments on the blockchain, bitcoins or cryptocurrency,” Sitharaman noted.
Blocking IP addresses belonging to crypto exchanges might not be a successful endeavor particularly with a technologically advanced population. There are several loopholes that Indian crypto investors may use to access crypto services.
To start with, the government may not be in a position to block users from using VPNs to access blocked sites. Furthermore, the government will encourage more people from sending money abroad to invest in the crypto industry.
Notably, the government of India has permitted up to $250,000 in the liberalized remittance scheme. Crypto investors in India can navigate through the proposed ban by sending money abroad.
However, India’s crypto ban may just be another ‘FUD’ meant to create fear in the crypto industry. Remember the industry is experiencing a bull rally and many fake stories emerge during bull markets as experienced during the 2017/2018 rally.