The Crypto Ban Decided by India Aimed to Curb Bitcoin and Cryptocurrencies

In April 2018, the Reserve Bank of India justified its crypto ban by the desire to curb “ring-fencing” of the country’s financial system. In addition, the RBI had argued that Bitcoin and other cryptocurrencies could not be treated as currencies since they were not based on anything tangible.

The RBI’s decision was a terrible setback for millions of Indians.

India is a booming economy with a huge population that has everything to gain from Bitcoin. The shutdown caused panic among many startups that had to stop investing in the cryptocurrency industry.

This arbitrary decision was all the more terrible because it was not based on anything concrete.

The RBI had stated that Bitcoin was dangerous because it was not made of metal and did not exist in physical form. Moreover, it was not stamped by the Government of India.

Such a decision clearly showed that the RBI had missed something with regard to the Bitcoin revolution.

Bitcoin doesn’t need to exist in physical form or be stamped by a government. Bitcoin offers its users freedom from state control over money. Bitcoin promotes the protection of individual liberties.

It is precisely the greater freedom that Bitcoin offers people that has frightened the Indian authorities and motivated this crypto ban.

This attempt to curb Bitcoin’s progress has ended up costing India more than anything else.

While thousands of startups from other countries are participating in the Bitcoin revolution by creating innovative services based on Bitcoin, the country has lagged behind.

At the insistence of Indian citizens, startups, but also the Internet and Mobile Association of India, the RBI has therefore decided to put an end to this crypto ban.

The RBI tried to save face following this decision by specifying that the crypto ban pronounced in April 2018 was in reality only a simple warning:

“The Reserve Bank of India has said it had not banned cryptocurrencies such as bitcoin in India, but only ringfenced regulated entities like banks from risks associated with trading of such virtual instruments.”

— RBI statement

The RBI statement thus paves the way for the use of Bitcoin and cryptocurrencies in Indian territory. Indians as well as startups in the country will thus be able to participate fully in the Blockchain revolution in the years to come.