Once again Indian Central Bank advocates the “Crypto ban” idea, says no upside of adoption

The Reserve Bank of India (RBI) clearly stated that there is no upside to regulate & use of cryptocurrencies under the jurisdiction of India.

The Reserve Bank of India (RBI), the country’s central bank, is a very big lover of blockchain technology but sadly a big hater of cryptocurrencies. In April 2018, RBI imposed a banking ban on the crypto companies & individuals dealing in cryptocurrencies but after a long-term fight between RBI and crypto advocates, in 2020 the court ordered the RBI body to revoke the crypto banking ban. 

According to local media reports, RBI officials said that the current status of the cryptocurrencies has very limited benefits under the regulated environment and also said that there are no advantages to integrating the crypto sector with the country’s economy.

Furthermore, the RBI official raised concerns against Crypto’s highly volatile nature & use in gambling activities. 

Through the latest statement, the RBI body once again advocated the crypto blanket ban idea, which is not the cup of tea for Indian crypto investors.

This year, under the presidency of the G-20 summit, the finance ministry of India proposed the idea of a global crypto regulatory framework to regulate the whole crypto sector under precise rules & laws.

Reportedly the Indian finance minister Nirmala Sitharaman discussed the possibility of developing a single crypto regulatory rule so that all the financial regulators in every country can easily adopt the rules to fight against the misuse of cryptocurrencies. 

Under the current Indian rules & laws, the crypto sector is evolving under the grey region. Under the proposed crypto tax policy, all crypto traders are required to pay a 30% tax against the profit generated on each crypto transaction.

Many times the crypto entrepreneurs raised concerns over the 1% TDS (advanced 1% crypto tax against each transaction on the crypto platforms) and asked the government agencies to change it to 0.1%. 

Because of the harsh crypto tax & TDS policy, all the Indian crypto exchanges are facing a huge downfall in the trade volume. Some of the crypto exchanges showed their interest to provide crypto cum stock trading services, in order to survive.

In this situation, either the crypto traders are using foreign crypto exchanges or decentralised crypto platforms e.g. Trust wallet, Atomic wallet, MetaMask, etc to trade crypto assets, in order to bypass 1% TDS rule easily.

Read also: Panic among Bitcoin traders starts, as Mt.Gox started repayment