Bitcoin’s decentralized nature makes it stand out amongst other cryptocurrencies. The use of blockchain technology also helps bitcoin to remain secure and authentic. But how far can these take bitcoin? Are there any borders that limit the growth of this coin?
India has a huge demand for cryptocurrencies. The population is too high to support the current currency. However, RBI (Reserve Bank of India) banned banks from supporting cryptocurrency-related transactions since April 6th, 2018. This meant that people would not withdraw fiat currency from exchanges.
RBI’s reason for this was that cryptocurrencies are a potential risk to the economy of India. There have been reports of cryptocurrency-related scams in India. In fact, on February 2nd, 2018, four individuals were arrested for running a crypto Ponzi scheme named Money Trade Coin (MTC). The accused allegedly collected around INR 200 crores (INR = Indian Rupee).
Since the ban, there has not been much impact on bitcoin since the time of the ban. Why? The answer lies in India being among the top 5 countries having maximum demand for cryptocurrencies like Bitcoin and many others. Visit The official BitQZ for more information on bitcoin trading.
There was a time when the price of Bitcoin skyrocketed, and other cryptocurrency prices followed suit. This caught the eyes of Indian citizens and government agencies like the Income Tax (IT) department as they started conducting raids across various states in India.
These raids were that Indian citizens were not reporting the earnings from bitcoin-related transactions. Moreover, the fact that people were using cryptocurrency exchanges was also going under the radar of government agencies because these platforms are mainly used to conduct foreign trade in cryptocurrencies via Indian bank accounts.
But what does this have to do with the relationship between India and other countries?
As mentioned earlier, India is quite populated. People are always on the lookout for ways to increase their income. As soon as this new market emerged, they started exploring it too. The primary reason for this was that no one knew that cryptocurrency was banned in India.
Most of the exchanges used by Indian citizens were hosted out of the country (mainly in Singapore and US). These exchanges also allow people to use their respective local currencies as fiat currency for trading purposes.
This explains the increase in the price of Bitcoin and other cryptocurrencies in the last couple of years. People living in rural areas with no job opportunities had a vast opportunity to increase their income by simply trading bitcoins for fiat currency.
On the other side, we had countries like the US, Japan, and South Korea, who were early adopters of cryptocurrencies. This country’s government bodies felt that cryptocurrencies could help countries think out of the box and develop unique solutions.
As a result, they were the first to implement a regulatory policy for cryptocurrency-related transactions. There are already talks about South Korea even considering their cryptocurrency as legal tender shortly.
In an interview with CNBC on April 17th, 2018, SEC (Securities and Exchange Commission) Chairman Jay Clayton spoke about cryptocurrencies. He thought there needed to be more regulation on cryptocurrencies to protect their citizens from scam artists.
But he also had positive views about cryptocurrencies like Bitcoin and said that they were looking at the overall growth of this technology. SEC is the regulatory body responsible for protecting investors and ensuring that all securities laws are followed.
Even Japan has seen a surge in digital currencies like Bitcoins. According to recent reports, it is expected that around $6 billion worth of BTC was traded in 2017 by Japanese citizens. This shows people’s initial response towards cryptocurrencies before any regulations were announced by respective governments.
India did not want to stay behind. This is where the recent crypto banking ban by RBI (Reserve Bank of India) comes into play. All the banks were banned from dealing with cryptocurrency-related transactions through the rupee. The main reason for this approach was to protect Indian citizens from frauds and scams related to cryptocurrencies. But it also had a significant impact on other countries in Asia.