There has been a lot of talk about the legality of Bitcoin in India, but there has been little focus on the legal framework used to regulate this cryptocurrency. For now, there is no official law for Bitcoin in the country, yet there are certain legal perspectives to keep in mind.
Does Bitcoin Need Different Regulation in India?
That seems to be the question a fair few people are asking themselves in the country right now, as there are no official guidelines for cryptocurrency put in place just yet. While this allows for unencumbered growth and innovation in the Bitcoin industry in the country, it also makes cryptocurrency look “less legal” in the eyes of consumers and enterprises.
Especially given the concerns of money laundering and terrorism funding with Bitcoin, one would come to expect there are certain repercussions. Seven Digital Cash LLP is under scrutiny by the government, as the Indian company deals in Bitcoin. While this investigation is still underway, it sets a dangerous precedent for cryptocurrency in the country.
This is where the lack of regulation is a shortcoming that needs to be addressed. Albeit there is a case to be made for how policymakers may try to impose too strict regulation which will hinder Bitcoin growth in the country, having no regulation at all is not that favorable either. The Reserve Bank of India is currently examining the issues associated with using Bitcoin under the current legal and regulatory guidelines.
Very few Bitcoin enthusiasts are for regulation Bitcoin, and a lot of people don’t see the point in doing so to begin with. Since there is no one to exert control over Bitcoin as a central leader or authority, regulatory guidelines won’t do much good in the long run. At the same time, new guidelines can provide a new level of legitimacy to Bitcoin, which is never a bad thing.
As much as people may like to think otherwise, the lack of regulation does not make Bitcoin legal in India by definition. It does not make it illegal either, but very few companies will take the risk of potentially getting burned in the future once regulatory guidelines are put in place. This situation will evolve over the coming years, and is one of the most exciting regions to keep an eye on regarding Bitcoin regulation.
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