Last week, the Reserve Bank of India (RBI) considered cryptocurrency as legal currency. This week, the Indian government has drafted up a national strategy regarding blockchain that includes provisos to establish a digital version of the rupee, the country’s official currency. Reports from the National Institute for Smart Governance (NISG) hhas submitted the blockchain draft or stakeholders to comment upon how such an idea might influence digital commerce in India.
This paper indicates that blockchain was a major topic at the Davos World Economic Forum; a survey pointed out that 10% of global GDP will be found within DLT by 2027. The blockchain strategy predicts that India will be among the top countries for just about everything related to blockchain and crypto within the private and public sectors in only five years. It further recommends that India establish an official cryptocurrency by working with the government and the RBI, said relationship should lead to a Central Bank Digital INR (CBDR) handled over “Public Permissioned Blockchain.”
The central bank is just one of several that have considered developing a personal CBDC. China currently leads the way with Europe’s banks struggling to keep up. The bureaucracy of the United States has prevented it from so much as entering the race over cryptocurrency.
The proposed draft emphasizes that laws and enforcement should be dictated on the functions computed by the blockchain rather than the technology involved. A National Permissioned Blockchain would allow the Indian government to offer trust as a service to many decentralized applications, as well as many permissioned blockchain apps.
One report by Bitcoinist stated that Indian regulators would relax capital controls. This measure would allow citizens to transfer as much as $250,000 outside of India each year and could encourage them to look into exchanging crypto with overseas markets.
While this idea is hardly a direct endorsement of crypto trading on the part of the Indian government, it is a step toward progress. While the RBI has confirmed that cryptocurrencies are not illegal in India, it is illegal for regulated entities to offer them within India. This situation has inspired many Indian crypto firms to campaign for a repeal of this ban on cryptocurrency. Crypto Kanoon, an Indian crypto commentator, has been busy over the past few days as they have relayed events at the courts in real time. It expects to hear a final decision no later than Friday.
