India plans to ban what it calls private cryptocurrencies, including the populous Bitcoin, and thousands of other altcoins, in favour of their own. The country’s lawmakers have published a new bill that will prohibit the use of private cryptocurrencies if passed into law.
However, the ban doesn’t mean the country doesn’t want its citizens to use crypto entirely. Instead, the new regulation will have specific exclusions in place “to promote the underlying technology [blockchain] of cryptocurrency and its uses.”
India seeks to promote underlying blockchain technology by leveraging it to create an official national cryptocurrency issued and regulated by its central bank.
India’s plan to restrict the use of “private cryptocurrencies” is not entirely new, after it rejected crypto as legal tenders in 2018. The 2018 proposal even recommended a 10-year jail term for offenders. The country’s central bank also argued that cryptocurrencies cannot be treated as money for the lack of physical counterparts and had not been stamped by the government.
However, it’s worth mentioning that the country’s Supreme Court sided with affected individuals and businesses last year, but it did not affect the earlier proposal.
The newly proposed bill will be presented in parliament in the current session.
Crypto use is yet to be accepted widely by regulators over difference concerns, like instability, and their decentralized nature. Till date, less than 20 countries have legalized cryptocurrency use globally, but their use spans across dozens of countries.
Resistance from regulators has been cited among the significant reasons slowing down wide adoption of cryptocurrencies.
There are even more hurdles in place in Africa than other developed nations. Among them includes competition from mobile money platforms, low smartphone penetration, poor infrastructure and regulation.