India’s Crypto Community Urges Not to Panic Due to Recent Ban

After the Reserve Bank of India (RBI) announced Thursday that regulated financial firms can no longer legally deal with cryptocurrencies, the local crypto community urges everyone to remain calm and to stop panic selling; others scoff at the whole story, declaring it FUD (Fear, Uncertainty and Doubt).

The urging, however, has not stopped the prices from falling: a Reddit user mervik9 posted what he claims are current prices of various coins in India, as everyone is looking to get rid of crypto:

Twitter user @pjain posted a thread explaining that this is not a ban on cryptocurrency, but a ban on converting crypto to fiat within the country. He also proposes various alternatives that the government could use to make crypto trading simpler and safer.

Another user, @joel_john95, tweeted his thoughts on the ban: “1. India has not banned #bitcoin 2. Banks had stopped working with exchanges in December 3. Government concerned about capital flight 4. Stricter AML/KYC enforcements will fix. A matter pushed by the IMF, FSB 5. Clean slate soon for ecosystem”

Those are reactions to the following statement by RBI:

“In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling [virtual currencies]. Regulated entities which already provide such services shall exit the relationship within a specified time. A circular in this regard is being issued separately.”

The statement also implies that the bank is aware of the technological advantages crypto offers, but they raise concerns about money laundering and consumer protection.

Whether India will take a more positive approach towards dealing with crypto remains to be seen. However, due to the steps made lately towards legalizing and regulating crypto, a complete ban resembling that of China seems like an unfounded fear.