What After RBI Ban on Cryptos?

Reserve Bank of India has said that any entity regulated by it like banks shall be barred from providing services to any individual or business dealing in Bitcoin and other cryptocurrencies. RBI has given three months to banks to exit their relationship with such entities. However, that doesn’t mean we can’t freely hold crypto currency.

That’s a knee-jerk action. Income Tax Dept collecting taxes on crypto, RBI banned banks from dealings in crypto entities and no clear statements from Central Govt. Situations will get more clear after a response from Central Government.

We will see a bearish trend in the near future. The development follows similar though less imposing bans by Google, Facebook, LinkedIn, Twitter and Snapchat.

On 5th December 2013, the People’s Bank of China also prohibited Chinese financial institutions from using Bitcoins when it was hovering around $600 to $800. Still, it managed to outperform very well from that level.

If the Indian Govt didn’t provide any relief in crypto space then:

• It will simply force the crypto project to settle down abroad similarly like Binance moved to Japan from China and now moving to Malta.
• It will become dead assets for people who are holding onto them. This is going to have huge repercussions.
• The nation will stay away from the immense benefits of crypto currency. It will be a very big technological hit to India.
• Increase in Illegal activities in crypto market. Regulation is only the solution.

The only fact that developed countries like South Korea, Japan, Canada, US etc are regulating crypto space instead of banning is enough to prove the recent irrational decision by RBI is not beneficial on the technological front. However, I appreciate their intention to safeguard retail investors from high volatility in crypto space. Though, regulating (instead of banning) the cryptos will be more appreciated.

So I personally believe — sooner or later — they will provide some relief as many developed nations already started regulating crypto space.

Our crypto project, MoatFund will continue to stay alive forever as it is completely operating on blockchain. However, we may face decline in fund raising in the ecosystem as our targetted audience is mostly Indian. Still, we are expecting investors with long horizons.

Sowmay
https://moatfund.com