Bitcoin and other cryptocurrencies are a global asset. They have no geographical borders and can be used anywhere by anyone. Still, some countries have taken measures to deter the use of cryptocurrency. India is a prime example. While Bitcoin, Ethereum, and other tokens are not specifically banned in India or illegal to own, the government has made it very difficult for individuals to use cryptocurrency.
India and Cryptocurrency
To say that India has a frosty attitude toward cryptocurrency would be putting it mildly. In 2018 India’s central bank decided to disengage itself from any bank that was involved with cryptocurrency exchanges. This was a blow, but it was only a harbinger of things to come.
In 2019 a panel was created which included several government agencies. The goal of the panel was to study Bitcoin and the impact and potential of cryptocurrency. One of the panel’s leaders proposed an extreme measure. Subhash Chandra Garg suggested that the mere act of owning Bitcoin in India should be reason for criminal prosecution.
Thankfully, cooler heads prevailed. In September of 2019 the Ministry of Finance released its own report that suggested India should not throw out the baby with the bathwater. The ministry suggested that the importance of blockchain technology was far too important to overlook.
Despite these developments, the legality of cryptocurrency in India remains in a sort of quagmire. There is still uncertainty about how Bitcoin fits in the country’s economy. This is not so different from the attitudes of many countries when it comes to crypto. Because of this uncertainty there are those who believe that cryptocurrency is banned in India.
Cryptocurrency Exchanges in India
Cryptocurrency itself is NOT banned in India. Residents of India are allowed to own Bitcoin or other crypto tokens. However, the problem is that access to many cryptocurrency exchanges is restricted in India. That makes it hard for some people to own or trade Bitcoin.
Many people who own Bitcoin have a cryptocurrency wallet that is hosted by an exchange such as Kraken or Coinbase. This wallet is where the individual keeps their Bitcoins stored. It is a safe manner of keeping cryptocurrency and Bitcoin users can access their tokens from anywhere in the world with a computer, phone, or tablet.
The other thing about crypto exchanges is that they allow those who own Bitcoin to easily exchange the cryptocurrency for cash or other tokens. Exchange of cryptocurrency has always been a thorny problem for Bitcoin. It can be difficult even under the best circumstances. Exchanges make it much easier.
By preventing residents of India from using cryptocurrency exchanges the government can make it harder to own Bitcoin. This also deters those who have no prior experience with Bitcoin and want to get involved. They see the country’s stance against crypto exchanges and the overall difficulty of buying Bitcoin as an obstacle that they would rather not bother crossing.
The Problem With India and Cryptocurrency
The approach taken by the Indian government towards Bitcoin has been problematic on many fronts. Now there are those in the government who are beginning to realize that a wholesale disegard of cryptocurrency could place the country at a disadvantage. Many other countries are moving forward with blockchain technology.
What India seems to have realized is that it needs to separate Bitcoin and blockchain technology. Yes, the two are intimately related, but blockchains are being used for many applications beyond cryptocurrency. To disregard these breakthroughs in technology is to perhaps fall behind the world’s approach to finance. As one of the largest countries in the world that is something India cannot really afford to do.
Is Cryptocurrency Banned in India? ANSWERED
There is currently no statewide ban on cryptocurrency in India. This means that if you live or work in India you are allowed to own and use Bitcoin. However, you may not be able to access or use cryptocurrency exchanges from within the country. That can make it hard to access your digital assets.
The cryptocurrency situation in India remains in a state of flux. It is always changing. We recommend that you check CryptoSwede often to get the latest news on Bitcoin in India.