So that’s it Game is over Curtains are down RBI's Deadline to remove all the support from Banks in favour of cryptocurrency exchange and transactions is finally reached and nothing can be done about it.
Yes many may say that we still have hope and we can still do the transaction in P2P market but common we are talking about volumes of trading and I am sure even my readers will agree that anything can have future only when it is adopted by masses. Banning banks from entering into transactions with Crypto exchange means we are stopping 70-80% of crypto enthusiast and traders to invest in cryptocurrencies.
Why ??
Why has the government taken such huge step when many countries are actively trying to facilitate blockchain startups and are promoting entrepreneurship related to block chains like the Philippines and what has made our government to go in the way China has gone?
As per my understanding and analysis, I have identified 5 Major reason's which has made India follow the footsteps of China although India has not banned it but has starved it for Oxygen at least for now.
Image Source Pixabay.com
Reason No-1 (Low Returns on Tradition Investment FD and RD)
As we all are aware and I have personally observed that we are not investing much of our money in Banks regular RD(Recurring deposit) and FD(fixed deposit) schemes. The reason is simple "low rate of interest". Obviously, our generation when we have started investing has never seen banks giving 12-15% interest rate as our parents use to get. Saying that we still use to keep money in Banks when we were receiving 7-8% return, now the returns are in 6-7% range and frankly speaking there is no reason for any informed investor to keep his money in bank as anyone with even decent level of understanding about inflation is aware that at 6-7% of interest rate, inflation will be eating up the value of money kept in the safe custody of banks.
That’s the reason Millennials are actively investing in Mutual funds and real estate than keeping money in banks.
Bitcoin's entry at this time was like the entry of a new hope and within the span of 1 year India reached among the top 10 Crypto trading countries. It was more than sufficient for the Indian government to not let investors invest money in something which they cannot regulate or does not have any mechanism to tax it as well.
Reason No-2 (Unregulated market)
Cryptocurrency market is unregulated as it is decentralized in nature regulation itself is not a cup of tea for a single government.
Well we Indian do have habit of taking huge risks understanding the loopholes of the system and then in case if things do not go well we start blaming the government for it and we expect our governments to take necessary action on this and if government ignores it considering you have the right to choose good or bad for yourself we tag our government to be ineffective and insensitive towards us.
This is the reason when RBI have seen that in spite of giving many warning Cryptocurrency investments are booming in India they have taken a strict stand to prevent such casualties which may happen in an unregulated market at least till the time regulations are in place which I personally believe is not a bad step.
Reason No-3 (Terrorist Funding)
There are some concerns that cryptocurrencies can be used by ISIS for funding terrorism "Al Khilafat Aridat(The Caliphate has returned)"is a pro-ISIS blog which discussed how Bitcoins can be used to fund Caliphate and Kafir governments (West mainly)can not trace its transactions.
So although there is no real-world case found where we can say that it is used for terrorist funding but I am sure even they are exploring what possibilities Bitcoin and other anonymous Cryptocurrencies can offer in realizing their agenda and this must be taken very seriously..!!
Reason No-4(Money Laundering)
Personally speaking Bitcoin may not be a really good idea for money laundering as all of its transactions are visible in Blockchain.com but we can only see the movement of money from wallet to wallet we can never know who is the owner of these wallet and this is where it becomes a lucrative option for any money laundering agent. Search the internet and we can find many news and article about money laundering cases through Bitcoin and off course we all know cross-border transfer of money is never so easy as it is now in the age of cryptocurrencies.
These are things which are out of the capacity of our governments to track and monitor and these can be dangerous.
Reason no-5(Ransomware attack and Kidnapping)
Talking about danger and there is the danger of Ransomware attack all over the world and guess what they always demand ransom in form of Bitcoin.
Wanncry??? Of course not then pay them 300$ worth of Bitcoin to get your data safe..!!
Forget about the online ransomware cases even local kidnappers are now asking payments in Bitcoin
We have a case of Surat Businessman who was kidnapped and ransom was asked in Bitcoins
All my readers might be thinking that I am in support of RBI's decisions, Well I am in favour of regulations because of the fact that I myself do not want that our very own Cryptocurrencies get a bad image. I am very much hope full about the future of Cryptocurrencies and their potential as a fantastic investment option but it will only survive if it is regulated and has healthy growth in upcoming 5-10 years.
I Would request my readers to share your opinion and views about this article so that even I can understand your prospective.!!