?OFFICIAL REPORT on Crypto Ban & New Digital Rupee Cryptocurrency from Indian Govt

So now I’d like to bring up this
complete report of the committee that proposes specific actions to be taken in
relation to virtual currencies and this document once again was published yesterday
on the 22nd of July 2019. And I’ve highlighted a few points that I found
quite interesting in this report and the first one is that they distinguished
countries into being three types right now there are countries with no
legislation when it comes to virtual currencies there are countries that have
legislative or regulatory framework on virtual currencies and there are
countries that have imposed outright bans or restrictions on virtual
currencies and once again this is something that this committee is
proposing that the government also does. The government in this case is being
advised to outright ban all cryptocurrencies in the country and if
we move on further into the document so this was part of the speech that was
delivered by the Union Finance Minister in his budget speech in 2018 and this
just highlights what blockchain has brought to the table of finance today.
And the potential that comes from blockchain technology. I personally found
that to be relatively positive that at least to start with the government
committee is recognising the importance of blockchain technology and the
importance of eradicating intermediaries and how that can lead to greater
efficiency in the economy if not in peer-to-peer transactions. So just keep
that in mind and we’ll move forward into the paper. Once again they mentioned that
as an introduction because they want to introduce the importance of what they
call distributed ledger technologies and they say that distributed ledger
technologies allow the recording sharing and transfer of data or value without
the need for a central record keeping as in the case of a traditional ledger so
once again they’re just mentioning that “We can now move out of the Stone Age
type finance system and move into something that’s much more efficient &
much more better, and we think that we can draw inspiration from what Bitcoin
has done for the last 11 years. And let’s start using that technology for our own
benefit”. That’s what they’re trying to say in my opinion. If we move further
into the paper, then one more thing is they mentioned a
cryptocurrency is a subset of virtual currencies and it’s decentralized and
protected by cryptography. They’re just defining in their opinion on what a
cryptocurrency is or should be and they also mentioned that other than Bitcoin
there are other several cryptocurrencies that have emerged in the last years as
we all know and they also funnily mentioned that as of date there are
around 2116 cryptocurrencies with a market cap of 120 billion US dollars.
This is clearly very out of date. When I look right now at coinmarketcap I can
see that there’s a total market cap of over 280 billion dollars. The committee
recognizes that while technological innovations including those underlying
virtual currencies have the potential to improve the efficiency and inclusiveness
of the financial system – once again saying that blockchain does have
potential in making things better – virtual currency in and of itself does
not have any of the benefits associated with fiat currency. Pretty sure that a
majority of us are going to disagree with what they’ve mentioned here. I’ve
highlighted it in red because I cannot agree with that last part of the
sentence in any way in any form from any angle
at all. Anyway they also mentioned that virtual currencies can be used to
defraud consumers particularly unsophisticated consumers or investors
so they’re trying to say that a lot of people might end up buying scam projects
like BitConnect although BitConnect was worth over a billion dollars at some
point. I do personally believe that markets are excellent sources of
eradicating scams eradicating bad projects and eventually it is the good
projects that do exist this is something we’ve had for many many many decades now.
Markets is not something that should be introduced to the government of India –
this is something they should have already understood. Ayway it looks like
the FATF once again something that I discussed in my previous videos has
influenced many parts of this document and they mentioned that the FATF has
observed that on account of the anonymity associated with virtual
currencies or cryptocurrencies they are vulnerable to money laundering and use
in terrorist financing activities while also making law
enforcement difficult. I know there was a study that was done that showed that
terrorists actually don’t know how to use cryptocurrencies. They either don’t
know how to use computers properly or are not educated enough to use Bitcoin
or any cryptocurrency efficiently or properly without getting caught and I
have to mention that many cryptocurrencies especially Bitcoin are
pseudo anonymous which means that you can trace things back to where that
transaction came from who sent you that money you can actually track these
terrorists down using cryptocurrencies if they’re gonna use Bitcoin to finance
illicit behavior illicit activities private companies like chainalysis for
example are providing services to governments and institutions for
conducting these chain analyses the committee recommends that all private
cryptocurrencies accept any cryptocurrency which may be issued by
the Government be banned in India. Yeah we know that already as we move further
into the document I must mention some parts of the document are actually
pretty good at mentioning what has historically happened with
cryptocurrencies with blockchain technology and Bitcoin it was quite
interesting to go through it we can only hope that the rest of the government
reads this paper and tries to understand virtual currencies and someone has the
common sense to say that guys we might be making a mistake banning everything
outright may be this extreme decision-making is not a good idea maybe
we should do something in between or maybe we should just legalize it and see
what happens with markets if we move further into the document you can see
how they’ve mentioned what different jurisdictions around the world have done
when it comes to cryptocurrencies how some countries have outright banned it
well just China basically and how some other countries have taken a different
approach to cryptocurrencies and they do acknowledge that they have considered
these different jurisdictions and what they have done to come up with their
conclusion although I must say it doesn’t seem like they were really
influenced by the positive nations when it comes to crypto the countries that
are more accepting of crypto they do speak about how different crypto
projects have used blockchain technologies for various purposes
and once again they do keep on mentioning their opinion how it hasn’t
really proven that blockchain is something that should be legalized or
something that should be allowed they do go into quite a lot of detail regarding
what they describe as central bank run digital currencies or CBD seized and I
think what they’re trying to say ultimately is that we don’t need to rely
on Bitcoin we don’t need to rely on other cryptocurrencies that the rest of
the world is using we can have our own cryptocurrency that has what they think
is exactly the same benefits as other cryptocurrencies as Bitcoin has but it’s
created and it’s issued by the Reserve Bank of India who ultimately will have
centralized control over this currency that will be created out of thin air
which they describe cryptocurrencies as being created out of thin air so the
recommendations that it’s given to the committee is that it has an open mind
regarding official digital currencies and that the Reserve Bank of India
should always be in charge of this digital currency that they’re proposing
to create and they’ve also summarized the different parts of this report they
do summarize their opinion on virtual currencies their opinion on other
cryptocurrencies they do indicate cryptocurrencies with a lot of
negativity they call them as being issued abroad they call them as being
private as having no intrinsic value at all I can’t see how bitcoin can be
referred to as a private cryptocurrency it’s not a private cryptocurrency from
any angle that I see in if you see in a private viewpoint then please do let me
know in the comment section below they also specifically mentioned there
is no fixed nominal value of these private cryptocurrencies I think what
they’re referring to is the volatility that we see in cryptocurrencies a lot of
the things they’re saying about cryptocurrencies is extremely inaccurate
and it’s potentially going to be misleading for future legislation in the
country of India and it’s definitely not a good thing this should be highlighted
by the people of India to the government if at all this is possible and this is
definitely something the government should really really look into properly
and try and understand properly not just because this
committee that is led by one single centralized person has come up with this
opinion it doesn’t mean it’s going to be scientific fact it’s clearly not a lot
of it is inaccurate. So that’s it for this episode. I hope you found it very
useful! Make sure you hit the like button the subscribe button and share this
video if you found it useful. I will continue covering the indian scene of
cryptocurrencies in the future, so make sure you do stay tuned and do have a
lovely week. Thanks a lot for watching see you guys!

Leave a Reply

Your email address will not be published. Required fields are marked *