In the last couple of years, we can see there are more stories about cryptos and their potential to become new global money. The popularity of cryptos is now at its peak nowadays. So, if you are interested in participating in the market, be sure you’re doing it right, Therefore, you should take a look at myfrugalbusiness.com and inform yourself a little bit better.
Not only that the existing ones are now highly popular, but we can also see that various countries have decided to introduce their own national cryptos. We are talking about counties like South Korea, Russia, China, and many more. One of these countries, India, has decided to introduce its own crypto, called Lakshmi. For those who don’t know, Lakshmi is the name of the Hindu goddess of wealth and money.
Sadly, we can see that this idea didn’t succeed. Therefore, the government was placed into the position when they are either going to adopt one of the existing ones, or there will be none of them. As we can see, they opted for the second scenario. However, not only that they have decided not to have their crypto, the government decided to ban all other ones.
Plus, there have been some threats that they will arrest any owner of the cryptos, mainly BTC. The regulation was introduced back in 2019, and it said that anyone who mines, sells, holds, and generates cryptos will be arrested and sentenced to ten years in prison. Surely, this situation generates a lot of challenges for the people interested in this concept in India. Therefore, we would like to talk about the biggest challenges these people are facing in this country. Let’s take a look at them.
1. There’s No Way Out
When you take a look at the proposed law, you will see that there’s no way out for people who dealt with cryptos before it. That doesn’t mean that the law will have a retrospective effect. Instead, many investors see it as a threat for them to leave their positions legally.
There’s no legal frame for the people who have been present at the market to sell their coins to foreign markets and, let’s say, turn legal once again. However, there’s still hope that some part of the law will present these people with an opportunity to sell their cryptos and exit the dangerous space imposed by the government. According to the recent statistics, around 5 million Indians have some connection to the market.
2. The Growth Can’t be Avoided
Despite all the regulations that might be imposed by the country’s officials, we can see that the future growth of cryptocurrencies in India can’t be avoided. However, the question is, will people be able to participate in the market in the same capacity. For example, maybe the owners will have an easier time buying them, but they will be prevented to sell them. We mean, who knows?
There are a lot of strange regulations all over the world that simply don’t function as they were imagined at the moment of their creation. At the same time, chances are that the people who’ve just started participating in it will not be content with this decision. Therefore, they will maybe continue to participate in it. However, they will avoid doing it in India. Surely, this means that the country will suffer a major loss just for not receiving a piece of that money through potential taxes.
3. A Bad Publicity
It’s not a surprise that the official institutions don’t like digital currencies since they cannot control them. Sure, it can be taxed, but the question of anonymity still stays unresolvable for the time being. Over time, digital currencies have gained some really bad publicity, especially in countries that are interested in banning them completely, like India. They are often regarded as a channel for terror financiers and money launderers.
We can see that there were allegations of ISIS having their own e-wallet, which received more than $20 million in just one month, back in 2015. While there is no way that this can be confirmed, due to the nature of the concept we are talking about, we can see that the bad name kind of stuck with BTC and all other cryptos. Nowadays, this is one of the commonest allegations digital currencies receive all over the world. However, it needs to be said that these allegations are still to be confirmed.
4. The Lack of Protection for Investors
We’ve already said that there is almost no way for investors to leave the market after the law has passed the regulatory institutions in India. At the same time, there’s no protection for them at all. There’s no protection for those who have been at the market for quite a long time. Meaning, they will need to completely abandon whatever they were doing at the crypto market and start a whole new career. Surely, this doesn’t sound right.
What’s even stranger is that the world is in the middle of a coronavirus crisis that almost destroyed the world’s economy. Just think about all the lost positions at various companies and how many years they will need to recover. So, it looks like the Indian officials are not ready to listen to problems investors have. Instead, they just want to ban all the cryptos for almost no reason. In this process, there’s no protection for people, which is an absolute must whenever there’s a shift in the country’s policy towards some concept, right?
Surely, you see that this is a pretty complex situation. The government is ready to completely ban the concept of digital currencies while there are more than 5 million people who are traders, holders, sellers, etc. Therefore, we can see that more than 5 million people are in danger of receiving a 10-year sentence. We absolutely agree that it sounds pretty harsh and dangerous for them. Here, we’ve provided you with four main challenges people who participate in the crypto market face in India. We hope that some solution to this problem will be found.