India is not new when it comes to harsh and unfriendly cryptocurrency laws. Now, Bloomberg reports that the country is set to introduce a new law which will ban cryptocurrency trading within its borders.
Citing anonymous sources, the report states that India’s federal cabinet is set to discuss the bill prior to being sent to the parliament.
The report states that the Indian government will continue encouraging and supporting the growth of blockchain technology but will discourage crypto trading.
In 2018, Indian central bank instituted a ban on all crypto transactions following numerous cases of frauds prior to the sudden decision to ban about 80% of the country’s currency by Prime Minister Narendra Modi. However, the decision was rescinded in March this year after a successful filing of a suit in the Supreme Court by various crypto-based firms operating in the country.
The lifting of the ban saw almost a 450% increase in crypto trading in just two months from March. Paxful, a Bitcoin marketplace, registered a staggering 883% growth from January to May this year representing a growth from $2.2 million to about $22.1 million in revenues. Similarly, India’s largest crypto exchange WazirX registered a growth of 400% and 270% in March and April respectively.
The renewed effort to ban crypto trading comes at a time when the Indian Parliament has reopened following a prolonged break due to COVID-19 pandemic. The bill is likely to be introduced to parliament in this monsoon session which kicked off yesterday and is set to affect over 1.7 million Indians who actively trade in digital assets as well as institutions coming up with platforms to ease crypto trading.
Today’s report appears to be in tandem with June’s news where the nation’s finance ministry was reportedly urging for inter-ministerial consultations on how to ban crypto.
In the recent past, India’s federal government has been exploring possible ways of using blockchain technology to enhance service delivery in different sectors like management of land records, enhancement of pharmaceutical drugs supply chains, management of educational certificates, among others but remains adamant against crypto trading.