Is the Indian Government Planning to Ban Bitcoin and Other Cryptocurrencies in India in 2021?
he government of India has listed a bill that provides for the ban of all “private cryptocurrencies” in India including Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Litecoin (LTC), Chainlink (LINK), and many more. The concerned bill titled “The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021” also provides a framework to create an official digital currency that will be issued by the Reserve Bank of India (RBI). The apex bank of India is already exploring the possibility of issuing their Rupee-backed CBDC (Central Bank Digital Currency), based on the technological background of cryptocurrencies.
This bill was introduced in the Indian parliament on January 29, 2021, the first day in the legislative order of business for the budget session of the 17th Lok Sabha (House of the People or the lower house of India’s bicameral Parliament). The Lok Sabha bulletin said that the concerned bill on cryptocurrencies will “create a facilitative framework for the creation of the official digital currency… prohibit investing all private cryptocurrencies in India.” However, the bulletin also made it clear that there will be certain exceptions for promoting the “underlying technology of cryptocurrency and its uses.”
Is it all over for Bitcoin and Cryptocurrency Enthusiasts and Traders in India?
No, it’s not. In fact, this is not the first time that the Indian government has shown interest in banning cryptos in India.
- In April 2018, the apex bank (Reserve Bank of India) had banned all bank and e-wallet transactions related to cryptocurrencies. Though this move was initially backed by the Supreme Court of India, it later overturned the RBI ban in March 2020.
- In 2019, a similar cryptocurrency bill was drafted. It proposed a ten-year-long prison sentence for any person holding, selling, and dealing in Bitcoin and other cryptocurrencies. However, this proposal was not brought into action by the government.
In recent times, Bitcoin has again attracted many Indians after its price skyrocketed in the last year. In 2020, the Bitcoin price had increased by more than 300%. Many Indians, especially youngsters, have started trading cryptocurrencies, just like many others in other countries. In fact, many people have also started mining Bitcoin and other cryptos to gain some of its share from the increased adoption.
With the astronomical rise in cryptocurrency trading, the incidence of fraud in Bitcoin and other cryptos has increased. These crypto frauds have become possible mainly because these cryptocurrencies are not regular as their traditional counterparts. That’s why there is an increasing demand for regulations of cryptocurrencies in India.
What do the Experts say about the New Cryptocurrency Bill of 2021?
However, not every expert believes that merely proposing a bill will provide a legal structure anytime soon.
- India’s leading Bitcoin and cryptocurrency exchange WazirX’s founder, Nischal Shetty, believes that the regulations should be correctly drafted and implemented. He believes that the right regulations can catapult India among the leading countries in the adoption of this technology. Shetty also made it clear that wrong or hasty regulations can set the crypto landscape back by a decade.
- Bitcoin Alliance’s co-founder, Vishal Gupta, predicted that no matter what the government thinks or does, the business of cryptocurrencies will continue. He suggested that the more sensible thing that the government could do is to regulate the crypto exchanges. In fact, that’s what most of the countries are doing currently. Gupta went on to say during an interview that India should not be left chasing and catching up at a time when one of the leading American cryptocurrency exchanges, Coinbase, is currently going public on NASDAQ.
- Another leading Indian cryptocurrency exchange BuyUcoin’s CEO Shivam Thakral has urged the Indian government to take an inclusive approach towards decision making. He urged them to come to a conclusion and make a decision only after taking the opinion of all the stakeholders in the crypto industry. In a prepared statement, he said:
“We will engage with our peers and other stakeholders to work towards protecting the interest of the industry. We look forward to a constructive dialogue with the government to reach a consensus on creating a positive digital asset ecosystem in India.”
If the proposed cryptocurrency regulations are implemented as per the currently proposed bill, it will directly affect the traders as well as the leading cryptocurrency platforms in India such as WazirX, BuyUcoin, CoinDCX, and CoinSwitch Kuber.
What does the Indian Central Bank say about Bitcoin, Other Cryptos, and CBDCs?
On January 25, 2021, the reserve Bank of India (RBI) issued a booklet that says that the central bank is exploring the possibilities of issuing a digital version of the Indian currency (Indian Rupee). It went on to say:
Private digital currencies have gained popularity in recent years…In India, the regulators and governments have been skeptical about these currencies and are apprehensive about the associated risks. Nevertheless, RBI is exploring the possibility as to whether there is a need for a digital version of fiat currency and, in case there is, how to operationalize it.
What can we Expect?
In 2019, the government of India reportedly wanted to ban cryptocurrencies and also criminalize all its possession. However, this bill was never introduced in the Indian Parliament.
The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, reportedly says that promotion of the underlying technology of cryptocurrency along with its uses would be allowed in case of certain exceptions.
Since March 2020 (especially after the Supreme Court of India overturned the RBI ban on cryptos), the trading volumes of Bitcoin and other cryptos have increased significantly. In fact, some of the cryptocurrency exchanges such as CoinDCX and Coinswitch Kuber have also raised early-stage funding for running their operations.
The 2021 crypto bill has sparked off speculation that the nascent cryptocurrency industry in India may end abruptly. However, till now the entire text of the bill is not available in the public domain.
Many cryptocurrency professionals and experts have pointed out that the term “private cryptocurrencies” doesn’t apply to Bitcoin and other major cryptos. This is because Bitcoin, Ethereum, and other cryptocurrencies are considered “public” in nature. They are “open and public” in nature and every participant can verify the transactions. That’s why Bitcoin, Ethereum, and other major cryptos don’t come within the purview of the ban on private cryptocurrencies in the bill.
CoinDCX’s CEO, Sumit Gupta, has said that the government has not yet made any clear communication regarding the public and private classification of Bitcoin and other public blockchains.
WazirX’s CEO Nischal Shetty has said:
“Over 7 Million crypto holders in India. Over $1 Billion+ crypto assets owned by Indians. Will the Government ban & erase all that wealth overnight? I don’t think so. The government will involve us, the industry, in further discussions and we’ll present our points.”
Best Ways to Invest in Bitcoin and Other Cryptocurrencies in India
If you want to invest in cryptocurrencies in India, the best way is to use reputed and reliable cryptocurrency exchanges. Some of the leading ones are:
You simply have to open an account with any of these reputed and reliable crypto exchanges and verify the account. Then you have to invest Indian Rupees (INR) in the bank account of the cryptocurrency exchange. You can also use the net banking feature to load INR into their exchange wallet. Once these simple steps are done (which takes less than 30-minutes), you are ready to buy Bitcoin and other cryptocurrencies with a click of a button. You can start investing in BTC with an investment of as low as Rs. 100.
You can also invest in Bitcoin in India through peer-to-peer trading. Use a reliable peer-to-peer (P2P) crypto trading platform such as Paxful to buy Bitcoin. While the buying transaction fee is 0%, the selling transaction fee is generally 1% of the total transaction amount.
Is it Possible to Make Income Automatically from Trading?
Yes, you can make income automatically from trading. You can put your trading on autopilot with a highly advanced algorithm that opens or closes positions. The crypto bots will scan the market in real-time and will trade for you automatically. Used correctly, automated systems can allow you to generate substantial profits. One of the leading cryptocurrency trading bots is NapBots.com.
Why Choose NapBots?
The best thing about this AI-driven bot is that it helps you earn money 24×7, even when you are sleeping. It gives you an edge over other investors as it enables the bot to book profits on your behalf when other investors are sleeping.
With the help of NapBots.com, you can connect to major exchanges such as Binance, Bitmex, Bitfinex, OKEX, Kraken, Bitstamp, and Bitpanda. Even with zero skills, you can start trading like a pro and earn money with this unique trading tool.
Before you take the plunge, you must understand that the crypto trading bots are not human. They are AI algorithms, which involve lines of codes and machine learning. When you are going for autopilot, you must know that you are allowing an AI machine learning tool to handle your crypto exchange account. Therefore, you should use an automated trading bot accordingly.
NapBots has a proven record of providing great returns to investors. However, it doesn’t guarantee profit all the time. As the crypto market is very volatile, you should expect to see losses from time to time too. If you’re not ready for that, you shouldn’t get into crypto trading in the first place.
If you are a novice in the cryptocurrency market, you can put your cryptocurrency trading on autopilot, get excellent ROI, and keep earning your passive income round the clock, even when you are sleeping. However, always keep in mind that NapBots is not a get-rich-quick scheme. You can have a look at the reviews on NapBots to make a wiser decision.
If you still need assistance, you can refer to the following guides:
- Should you invest in bitcoin and crypto currencies?
- How to invest in crypto currencies like a pro?
- The 3 best ways to invest in gold
- Stock trading and investing
- Everything you need to know to invest in cryptos
- What you should know about crypto taxes
- How can you minimise your crypto taxes
- What is the next bitcoin investment like?
- Big tech push toward crypto currencies
- Religion and trading cryptos
- Muslims in bitcoin and cryptocurrencies
- Can become bitcoin a safe investment?