A turn for the worse? India’s crypto plan unsettling to local industry

The Indian Crypto community has been involved in discussions with the government about how it should perceive cryptocurrencies and blockchain technology before finding ways to regulate the industry ever since the government placed a now-defunct blanket ban on banks servicing crypto firms in April 2018.

In the latest update, on Jan. 29, the government revealed its plans to introduce The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 to the lower house of the parliament (The Lok Sabha) in the upcoming session.

As mentioned in the Lok Sabha’s release, the bill would have a two-fold agenda. The first is “to create a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India” and the second one being to “prohibit all private cryptocurrencies in India” while also stating that it would allow for certain exceptions to promote blockchain, which is the underlying technology behind crypto.

The bill’s announcement caused panic

As the budget was going to be announced just two days later, on Feb. 1, the proposed bill listed on the agenda of the parliament sent waves of panic across the Indian crypto industry, as some assumed that the government would announce its intention to ban “private cryptocurrencies” during the budget.

This panic even led to Bitcoin (BTC) trading at a 20% discount to global prices, whereas it usually trades at a premium of up to 10%. However, the community breathed a sigh of relief when the current Minister of Finance and Corporate Affairs, Nirmala Sitharaman, didn’t mention anything on the subject during the budget announcement. This also caused Bitcoin’s price to recover in India after the budget announcement.

Nischal Shetty, CEO and founder of WazirX cryptocurrency exchange, told Cointelegraph: “The fact that it was not mentioned in the budget shows that the government isn’t in a hurry to make a decision.” Shetty also went on to say how the government…

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