Cryptocurrencies in India Might Get Regulation but RBI Sees Them as Competition for Digital Rupee
Digital entertainment platforms providing OTT streaming and betting sites accepting Paytm and Google Pay are hoping to get approval for crypto payments as well. The Centre, however, is still hesitant on whether to regulate or ban cryptocurrencies and introduce an RBI-backed digital rupee.
Crypto Assets in Legal Limbo as New Regulation Is Rumoured
Payment terms and financial security have always been key for online users. Whether it’s investment or daily consumption, the safety of personal information and security of money transfers is a major concern and an aspect able to promote or bring down a business.
Cryptocurrencies have been gaining traction among investors for a few years and the dynamic desi market is no exception. Getting reliable information on investing and spending real money in India via digital currencies is not easy, as the Government has only tentative rules in place.
Crypto exchange platforms and betting sites accepting Paytm and other digital payments are anxious to know whether recent reports on possible crypto regulation in India might be true. According to the former Finance Secretary, Subhash Chandra Garg, the Government should consider clear crypto asset legislation instead of a complete ban.
Garg was heading a panel of public officials which recommended a blanket ban on all cryptocurrencies and their digital derivatives back in 2019. The Draft Bill was never introduced in Parliament yet went along the lines of unofficial Government policy of avoiding to legally regulate crypto markets.
A direct ban on crypto transactions was imposed by the Reserve Bank of India (RBI) back in 2018. It was finally overturned by the Supreme Court two years later.
Latest reports from New Delhi reveal the possibility of a Government committee finally dealing with the subject. The hope of many industry experts is that the Centre and RBI will look beyond cryptocurrencies and consider crypto assets as only one useful tool for economic growth based on a technology with immense potential. Blockchain services and digital features have been at the foundation of more than 300 desi start-ups and are clearly encouraged by the entire business ecosystem.
Retail Operators Accepting Paytm, Google Pay and other UPI Channels Would Welcome Another Safe Payment Alternative
Providing a legal framework for blockchain technology and crypto assets is expected to stimulate both crypto investors and retail operators. While differing in monetary terms, crypto transactions ensure top level safety standards and maintain a high potential for market growth.
On the other hand, Parliament is expected to review how private digital currencies might compete with RBI plans to launch a national crypto coin. The least that a successful Digital Currency Bill would achieve is to lay down foundations for formal blockchain recognition.
The underlying crypto technology already has numerous successful uses and its exploitation would help the national economy and the digital sector. Online exchanges, retail operators and digital entertainment platforms would gladly welcome another innovative and stable technological solution – for payments, contracts, Know-your-customer procedures and much more.
Some of the leading Bharat banks have been sending warning notices to customers and card holders that investments and transactions in cryptocurrencies are not formally regulated in the Union (even though formally these are not outlawed). Despite such questionable practices, investors choose to remain optimistic and wait for formal regulation and industry standards.
Indeed, when asked about the future of crypto assets, most young consumers (millennials in this survey) believe that the Centre would not completely ban crypto and will find a way to exploit the potential of blockchain.