Why Other Countries Accepting Bitcoin Excluding India: A Wake-Up Call
Is the radical idea of digital, cryptographic asset really a censorable concern for an Indian govt.? Why the overseers are unable to see the worth of the digital assets? Why it is still yet to see the final verdict of the govt. which is pending for many months.
There is no second thought that cryptocurrency would lead to a colossal geopolitical disruption. This can further lead to a shifting of power relation between governments and the citizens. The Indian government has almost made up its mind against bitcoin and seems like considering it as a revolutionary army which will be going to collapse the corrupted administrators. So, the clever move by the government is why not to curb it before any danger comes in the country which has the clear potential to overpower the control of the system. Probably the Indian government is deliberating the consequences of the going bitcoin into the mainstream.
In February 2018, finance minister Arun Jaitley in his Budget speech had said that the government does not see cryptocurrency as legal tender, giving a clear message on the warnings issued by RBI and by the finance ministry. He also said that the government will take measures to eliminate the use of such currencies in financing illegitimate activities or as part of the payment system.
In fact, India’s complicated relationship with virtual currencies and firms dealing with them struggling due to the uneasy law and orders. The situation became worse after April 22, the Delhi High Court’s notice to the Reserve Bank of India (RBI) after a petition challenging the banking regulator’s April 06 order prohibiting lenders/banks from doing business with cryptocurrency exchanges.
Further, in November, the government had again initiated its negative stance by appointing a panel to draft the norms for virtual currencies which was headed by Subhash Chandra Garg, secretary, department of economic affairs (DEA) and has submitted its report to the finance minister Arun Jaitley relaying “the law should enlist punitive measures that the government and its investigative agencies can take in case if it finds anyone or any entity trading or dealing/ holding it.”
On the contrary, the panel has also suggested the consideration of venturing India into cryptocurrency that a new sovereign backed virtual or cryptocurrency may be proposed considering global circumstances; probably at a later stage.
The above statements are so contradicting that a normal man is damn confused about its own country’s government decision over the controversial approach towards the highly revolutionary money and that is why people of the country are trusting foreign governments and their ways.
Worldwide the sector’s rapid rise has been pushed up as an important realization for innovation and a new era for the financial sector. Blockchain has been signified as a breakthrough innovation- the digital programming underpinning most cryptocurrencies, with its distributed-ledger proof and verification technique.
Jagadish Pandya, the co-founder, CREBACO, precisely shown his concerns and voiced out against the negligible attitude of the Indian government by saying that, “we understand the rapid build-up in price has caused concerns and several major digital assets inflated, regulators universally have grown worried about rampant speculation. Still, the new classification and coordination are currently being implemented by major international financial institutions to increase the speed and reliability of their own clearing systems. When will Indian government realize the worth of this upcoming change and lead the masses of its own country who are going outside the nation for the help and jurisdiction? The amazing talent is going outside the country and we are just doing nothing.”
In fact, if we look at the global front and the numbers except for India and China, world governments have been seen surprisingly welcoming cryptocurrencies. We can easily notice Bitcoin is improving its legal status in spite of so much volatility and acceptance in almost every progressive country. However, the legal status of bitcoin and other related cryptocurrencies varies substantially and classified differently from country to country. The new digital money has got the permission to use and trade recently in these countries:
Earlier this year the central bank of the Philippines or The Bangko Sentral ng Pilipinas (BSP) has published its update on Virtual Currency (VC) confined in one illustration.
Source Image: BSP Facebook page
The explanation is lucid enough to explain the differences between virtual currencies, e-Money, and Fiat/Real Currency.
Bangko Sentral Ng Pilipinas (BSP) issued the guidelines for cryptocurrency exchanges in the Philippines, and from then on, 6 companies have been registered with the regulator.
Six popular cryptocurrency companies registered with the central bank in the Philippines are :
· Coins.ph via Betur Inc.
· SCI Ventures via Rebittance Inc. BloomSolutions
· Virtual Currency Philippines Inc
· Philippine Digital Asset Exchange (PDAX)
On August 02, 2018, the SEC has cleared their position on the subject of new ICO’s and cryptocurrency regulations: “Under the draft rules, the tokens issued by the startups or companies conducting the ICO may follow the nature of a security under Section 3.1 of the Securities Regulation Code, and therefore, these should be registered with the Commission and necessary disclosures need to be made for the protection of the investing public.”
In April this year Bank Negara Announcedthe new developments through its official website and asked the public to understand and contribute to the new regulations as a way of countering various crimes. As the Malaysian authorities understood the need of implementing the new norms and create a balance between the situation and interest of the masses. The government has come up with new norms and taken a call with recent plans which can to an extent curb the concern of using online currencies by criminals or terrorist groups for money-laundering or illicit financing.
The recommended regulations would require corporates to verify the identities of the clients, monitor all cryptocurrency-based transactions, and report any questionable dealings to the Malaysian authorities. Moreover, the rules necessitate all companies to report usage statistics to the country’s central bank regularly. Maybe this will be a smart move because Malaysia has recorded with many terror-affiliated criminals.
BNM governor Muhammad Ibrahim expects the rules would bring to an end the cases of money laundering and terror-related financing concerns using digital currencies in Malaysia which can also bring transparency and regulation.
Since the beginning of 2018, the Thai government has faded away from the dilemmas against cryptocurrencies and has been seen outspoken and hailing cryptocurrency and blockchain projects in an effort to encourage investment and attract foreign companies.
In June, the government legalized seven cryptocurrencies: Bitcoin, Ethereum, Bitcoin cash, Ethereum classic, Litecoin, Ripple and Stellar, and also a limited number of cryptocurrency exchanges and broker-dealers are allowed to apply for operating licenses.
In July, the Thai Securities and Exchange Commission (SEC) legitimate additional digital tokenissuers to file for applications, and categorized ICOs into three types: investment tokens, utility tokens, and cryptocurrency wherein token issuers required to apply for approval with the Thai SEC to operate in the kingdom. Thailand’s clear and explicit ICO and cryptocurrency guidelines have attracted several foreign companies seeking business opportunities in the country.
One of the world’s top 15 economies is on the edge of playing a major role in embracing cryptocurrencies. The country’s regulatory and tax framework policy for cryptocurrencies which are exempted from capital gains tax since 2013 is engaging in a crucial role in cryptocurrency adoption. Specifically after March 2018 because earlier trading of cryptocurrencies was banned in the country but when the government realized that the restrictions saw plenty of subsidiaries and projects heading offshore to launch ICOs then the regulation in the country started to thaw. The recent announcement of spending 1 trillion won (USD $880 million) by the Korean government on blockchain development in 2019 as part of a 5 trillion won package to stimulate the economy through innovation is an upfront indicator that South Korea is changing its stance and generating a more constructive climate for blockchain technology and the legitimization of cryptocurrency.
Japan indeed a leading country in the world accepted, regularized, and legalized cryptocurrencies long back and still in the continuous process of improvising the system favoring the interest and security of the populace. The recent hacks of Japanese exchanges are no doubt bugging but the popularity of cryptocurrency in Japan has led to some of the best laws about crypto in the world. Japanese regulators are believed to be the most forward-thinking government officials in the world. In fact, Japan’s major cryptocurrency exchanges are registered as financial services institutions.
In fact, more than 3.5 million individuals actively using and trading cryptocurrencies in the nation. Japan is the first and only country to recognize cryptocurrency within the legal system and provide a legitimate way for its citizens to engage with crypto.
Monetary Authority of Singapore (MAS) is much more advanced and far ahead of many other developed countries pertaining to their understanding of the new industry and strategies for the future progression of the economy. The authority is not only just regulate the revolutionary technology but its core purpose of regulating decentralized money. In August 2018, the authority announcedthat it will work along with global institutions in order to introduce tokenized digital currencies.
Moreover, the city-state’s attitude in general towards the subject has been historically positive. Earlier in February, Singapore’s Deputy Prime Minister Tharman Shanmugaratnam expressed the positive stance:
“The Monetary Authority of Singapore (MAS) has been closely studying these developments and the potential risks they pose. As of now, there is no strong case to ban cryptocurrency trading here.”
Further on 15 March. Ravi Menon, Managing Director, MAS, at money20/20, Singapore, in his speech addressed the masses, “the regulation cannot address all the concerns around crypto tokens. The industry too has a part to play in strengthening the ecosystem, for instance, by adopting best practices around transparency, cybersecurity, and record-keeping. The new generation of crypto tokens emerges, that harnesses the potential of blockchain technology for social good while mitigating the risks today’s tokens pose. This is a future worth securing and I hope that some of the talents gathered in this hall will help to make it happen.”
This year UAE has also seen in the sprint of becoming a global leader in the adoption of blockchain and cryptocurrencies. Recently, Emcredit, Dubai’s official government credit bureau, has partnered with Pundi X, a blockchain payment provider, and Ebooc Fintech & Loyalty Labs LLC, to facilitate digital currency payments in the city.
In June, The financial authority of Abu Dhabi Global Market (ADGM ) has introduced a regulatory framework for cryptocurrency activities. The market’s financial watchdog FSRA has also published a guideline explaining how crypto asset activities are now regulated through a 34-page guidefor the regulation of crypto asset activities in ADGM. The document explains the regulatory framework for crypto assets including the requirements for operating a crypto asset business, exchange or custodian.
This is a valuable update for the scope of cryptocurrencies worldwide. The above mentioned few countries earlier weren’t in the favour of the new digital money but now after understanding the growth aspects and at the same time respecting the interest of the people these well matured nations are coming forward in a right direction. Few countries — like the USA — central bankers, monetary czars, and specific legislators are actively observing Bitcoin as significant opportunity rather than a threat. Utilitarian regulations are on the horizon and some has come to the conclusion that a distributed, decentralized trading platform, like Bitcoin, does not intimidate domestic policy and tax compliance — even if general public begin to treat it as cash rather than a payment mechanism. Although a cash-like transition might ultimately challenge the federal reserve monetary regime and some special interests, this is not certainly a bad thing when the question is for making a stronger economy then the affected interest seems nowhere.
Sidharth Sogani, Founder of CREBACO, admonishing the wrong decision makers of the country articulating that the ban on Bitcoin is impossible and implausible because it is designed to get the liberation and bring the decentralization which will be truly overpowering the control of any government or central authority. For citizens to develop trust and respect for their governments it is imperative to regulate the crypto which is backed by cash. If positive regulations happen in a country like India which is one of the top 5 markets in the world the governments will no longer be able to water down citizen wealth by running the printing press, nor borrow against unborn generations.
Logically, this type of change will frighten entrenched lawmakers. The concept of separating a government from its own monetary policy seems — well — radical! Just because we haven’t previously confronted the avant-garde technology that can state the government transparency and accountability lined up with the sector necessities to upkeep with it… doesn’t imply it can never happen… The time has come for the confrontation… In spite of the banking ban, OTC trades are taking place in the country. A lot of election money is being circulated through OTC Cash transactions using Bitcoin. Looking at this I don’t think the government will regulate bitcoin before elections to save their own skin…
Both Sogani and Pandya, accurately exclaimed that the Indian government being ingenious seems not understanding the point and just self-indulged in crooked and unfair politics. Lately created a fuss by introducing a ban kind of impression which already questioned about the intellect of the politicians and well-polished political advisors of the country.
If we perceive the history the information technology act was announced in 2000 and the internet was born in the early 1990s. Being such a huge potential whether in numbers or in brain power India is always known to be behind the world by 10 years due to the political predicament. Such scenarios will continue to hamper the growth aspects of the country. If truth to be told to ban bitcoin the authorities have to ban internet which is impractical and unattainable.
Now the question is when will the reactive and short-sighted Indian government come forward and do something positive for the nation instead of deploying useless ploys like demonetization???