As an investor, you would have probably thought of investing in the lucrative cryptocurrency market. But the ban on cryptocurrencies which was imposed by the Reserve Bank of India in April 2018 has probably left you with no option. Well, now you can trade in cryptocurrencies, because Supreme court has quashed the ban imposed by RBI.
The RBI issued a circular in 2018, where banks were barred from trading in cryptocurrencies, which was challenged in Supreme court by the Internet and Mobile Association of India (IAMAI). The main argument was based on the statement of IAMAI, where they declared that cryptocurrency is more of a commodity. The RBI has no such powers to impose such a ban on the trade of a commodity. IAMAI also filed in its report that banning cryptocurrencies will only remove it from the legal economy but also give rise to the same through black market transactions.
RBI in its argument stated that it had been cautioning cryptocurrency users. It is not possible to track the transactions which have been initiated using cryptocurrencies and it is thus impossible to track them. IT was also a mechanism which could promote money laundering activities in the country.
The cryptocurrency market has evolved a lot. The most valued cryptocurrency, Bitcoin had a market cap of over $ 160 billion. There were various companies which were trading in bitcoins and the ban on cryptocurrencies has forced them to wind up their operations. The lift on the ban was awaited since last two years. The block chain mechanism, on which cryptocurrencies are based in an evolving technology and the lift of the ban can result in lot of activities around this space.
The lift on the ban imposed by the Reserve Bank of India which did not allowed to engage with cryptocurrencies will generate new investment opportunities. There were various investors who were trading in these and the ban on the same had forced them to either square off their positions immediately or to opt for the black-market route for the same.
However, trading or investing in cryptocurrencies is very risky as they are not governed by any law and it is next to impossible to track them. If you are new to the investment world, it is better to start trading with some other market forms before stepping into this high-risk market.
Considering the RBI ban, the future of cryptocurrencies in India is also very uncertain. One must be very careful before entering this market, because it may be tempting but has your investment will be at risk always, and the risk will be higher, considering other form of investments.
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