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In an article released today on the internet business platform Quartz India, it was reported that India ranks 11 in the world as regards cryptocurrency adoption. According to the report “Indian investors are flocking to cryptocurrencies like never before”.
With a population of 1.39 billion that is predominantly young and tech savy, the potential for India is staggering. And despite an ambiguous or somewhat negative stance on crypto by the government, its popularity is unrivaled, and the market continues to grow.
The growing rate of adoption in the country is happening in the face of the possibility of imminent prohibitions and regulation from the Reserve Bank of India (RBI). The RBI has been pivoting on the issue of cryptocurrency in the past years.
It was in 2018 that the RBI issued a prohibitive ruling in dealing in virtual currencies, due to the associated risks involved in transacting in these assets. This ruling was overturned in March of last year, effectively starting a renewed surge of crypto investment in the country.
Th best thing, yet quite confusing, related to this ruling happened on March 31 this year when the RBI ordered banks not to cite the original 2018 prohibitive ruling, stating:
“It has come to our attention through media reports that certain banks/ regulated entities have cautioned their customers against dealing in virtual currencies… by referring to the RBI circular dated April 06. Such references to the above circular by banks/ regulated entities are not in order as this circular was set aside by the supreme court.”
With this note, the RBI ordered Indian banks NOT to stop its customers from dealing in crypto assets.
The future and direction of the Indian government with regards to cryptocurrencies remains unsure. There are some indications that India might go the same path as the Chinese by concentrating exclusively on backing a central bank digital currency, whilst banning crypto in order to allow it to flourish.
The potential hammer hanging over the Indian market does not withhold Indians to stack up on cryptocurrencies. Indians are buying the dip in while they still can, hoping to maintain a strong position in crypto as a hedge against the manipulative powers of their government and a driver for their own personal financial freedom.