Reserve Bank of India May Grant Legal Tender Status to Bitcoin

It appears the Indian government is finally ready to make a decision about Bitcoin and other cryptocurrencies. For a nation with such a strong focus on financial innovation, its leadership remains rather indecisive when it comes to Bitcoin and cryptocurrency. Indeed, there is no official regulation or legal recognition for such currencies in the country whatsoever. However, that situation may finally change in the weeks ahead.

RBI May Render a Decision on Bitcoin Soon

Many governments are struggling to properly define Bitcoin and cryptocurrencies right now. This new form of money is so unlike any other form of currency we have seen to date, it makes little sense to introduce complicated regulation. However, some governments are still taking a very cautious approach by imposing harsh regulations first and foremost. Other nations are seemingly not bothered with regulation at all, which understandably creates confusion for the everyday consumer.

India may very well become one of the hottest countries for Bitcoin in the coming years. The Reserve Bank of India is currently looking into drafting cryptocurrency regulation in the near future, although there is no indication as to how things will unfold. A task force has been set up to potentially grant Bitcoin and other cryptocurrencies legal tender status in the coming weeks.

The RBI is not all too comfortable with Bitcoin because it cannot be properly controlled by banks or governments. This degree of financial freedom provided to consumers and businesses is quite worrisome, for obvious reasons. The Indian government has issued a warning about how cryptocurrencies are, for all intents and purposes, still considered tools suited for money laundering and illegal activity. Coming up with a solution to prevent such illicit activity will be pretty challenging.

With some much uncertainty surrounding the RBI’s research into Bitcoin right now, everyone agrees that their decision will carry a lot of weight. It is possible the outcome will be positive, but we may see a restriction of cryptocurrencies as well, for all we know. The fact that the RBI is in active talks with industry experts indicates a somewhat open-minded approach toward regulating this industry.

Any discussion around cryptocurrency regulation will certainly cause some debate among Bitcoin community members. Many individuals feel there should be no regulation whatsoever, as officials cannot control the protocol itself. All governments can do is impose restrictions or guidelines for regular businesses dealing with cryptocurrency, which may stifle innovation in the long run. We can only hope that does not happen, as India stands to benefit significantly from Bitcoin and other cryptocurrencies.

Discussions like these will become more prevalent on a global scale as time progresses. Cryptocurrencies can no longer be ignored, despite the current downtrend. All of this panic stems from unconfirmed rumors originating from China. Once the air clears, it is not unlikely the Bitcoin price would return to the US$5,000 mark before year’s end. Only time will tell what the future holds in India, though.