A former Indian government official, Shaktikanta Das, for the Indian Administrative Service (IAS) and previously Sherpa for the Development Track of G20 Talks, has stated that crypto “should not be allowed at all”.
Why should we listen to Das?
In a statement to Quartz India, Das stated that cryptocurrencies should be banned because it would be too hard to properly regulate them. Das has been actively involved in regulatory discussions for virtual currencies in India. In April 2017, Das headed up the first government panel to regulate cryptocurrencies.
Since cryptocurrencies are not asset-backed and “created out of vacuum” and “thin air”, they present a real problem. Interestingly enough, neither are fiat currencies. However, Das did choose to compare them to securities.
Regulation is a “serious challenge” but so is a ban
As part of his statement, Das said of digital currencies, “Let us accept that it would not be possible to regulate it effectively. Because they will do transactions from their houses. You cannot enter every home to check what transactions are going on. So, I think this is a serious challenge, and this should not be allowed at all.”
However, there are those that believe that a complete ban on virtual currencies could be disastrous for the Indian economy. It would lead to a series of financial problems for the country. The reason being that there are major economies that have allowed them, namely Japan and some European countries.
Indian exchanges halted
India has had a complicated relationship with digital currencies and has issued tax collection notices, decrees to ban them as legal tender and most recently, has forced exchanges BTCXIndia and ETHEXIndia to halt trading.
Both exchanges’ websites currently display a notice to customers. This notice advises customers that after January 1, attempts to deposit funds in exchange for cryptocurrencies will be automatically be returned to the associated investor’s bank account.
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