India is leveraging technological advancement with each single update. Cryptocurrency exchanges show no sign of slowing in India. The crypto market has fully-fledged with the expansion of crypto trading platforms from its uncertain level to what it is nowadays.  

“Despite the issues that cryptocurrencies face in INR withdrawls, the market is having what we can call the mother of all bull runs right now”.

Mr. Chandan Choudhury, a cryptocurrency analyst and trader from Bengaluru said.

On 8^th Nov 2016, PM Narendra Modi stated the commencing of a demonetization rule. Because of that change by the Indian government around 86% of the country’s paper currency affected through the subcontinent of India. It would be an ordinary practice to obtain huge orders for Bitcoin/other digital coins and then sell them in a future. A lot of Indians, having Internet accessibility has begun to buy Bitcoin and make other investments in virtual currencies.

With India’s demonetization, the capacity of Bitcoin being traded has significantly improved twice compare to its previous levels that pushing its value to new heights. India’s three cryptocurrency trading platforms – ZebPay ($1 million), Unocoin ($1.5 million), and Coinsecure ($1.5 million) have recorded a surge in new users who are eager to try crypto coins as another asset. So we can clearly say that demonetization wouldn’t have affected people as they start trading in crypto.

What happened then?

The Reserve Bank of India proclaimed a ban on cryptocurrency trade and declared that Bitcoin/Alt coins could not be funded to utilize Indian banking systems/portals. The Supreme Court’s decision that preserving the RBI’s ban on banks which is dealing with crypto coins has saddened the industry and reduced speed of businesses. But the thing is players of the industry are declining to let the sector decease, with almost everyone is now shifting to a Peer-to-Peer model to moderate the shock.

“Blockchain nodes can be chosen, so the government can actually monitor it. We can also filter these assets in terms of credibility. We, for example, don’t allow trading of certain assets. We can work with the government in determining such caveats”.

Co-founder and CEO of Koinex, Mr. Rahul Raj said.

Prices of crypto coins demolish by nearly 50% within just a single day after the release of RBI’s circular. The ministry of finance is, however, to mark a final presiding on an official ban, but the current instability in crypto markets is strengthening down the industry.

“Presently all the major industry players are offering the crypto to fiat and fiat to crypto conversions. The crypto to crypto market does not have much traction. Given this scenario, there will be quite a bit of drop in the interest among the customers”.

Co-Founder and CEO of Unocoin Mr. Sathvik Vishwanath said.

Why it happened?

It is merely to look after investors’ interest. There is no base or foundation when it comes to crypto coins. It is not based on any asset, and no one is liable for its assessment. It is a clear assumption. Many had mislaid in cryptos. The overall loss to Indians is nearby Rs.2500 crores.

Plenty of digital currency had failed earlier. The well-known digital currency given out by Stanley Morgan ended many busts. Numerous countries expelled crypto.

The Reserve Bank of India banned Crypto coins mainly Bitcoin because of below-mentioned extortions:

• Owed to its virtual nature, it’s quite simple to hack.
• There is no central authority to control the transactions and to complain.
• Lack of underlying of any VC makes value a substance of assumption.
• Exchange platforms are situated globally in different parts which are being complicated for plenty of dominion of several nations.
• Forex Trading may be exposed to several prohibited and illegitimate transaction to purchase/exchanges of social iniquities such as weaponries which are simply accessible in a shady web.
• Bitcoin may disturb the stability of a nation’s currency and economy by lack of usability.

Ban cryptocurrency would be like rejecting something that will certainly become a part of our day-to-day lives. E.g., with initiation of the internet, there were numerous criticizers supposed that the internet was just a craze, and would ultimately dispel.

But there is a common element among the internet and cryptocurrency, and that is decentralization. We can say the internet was the first trend when it comes to digital decentralization. That tendency is only enduring with cryptocurrency.

Bitcoin is today’s digital gold. It doesn’t need any trust as there is no middle-man. Those who comprehend the technology — and there are many smart people left their high compensating professions to work in distributed ledger technology — recognizing that this is the future of cash. It cannot be just a craze.

What are the consequences and Global impact of it?

If we talk about the current situation of exchanges and traders in India, they have jumbled after RBI clampdown. Some of the exchanges are repurposing their trade to sidestep from the rule of the central bank.

From the beginning, a crypto market of India was formed by the nation’s harsh principles — especially its system of capital controls, commendable blocked Indian public from utilizing local bank accounts to exchange crypto coins on worldwide trading platforms.

This destined a long-lasting squash on the onshore stream of crypto coins. Some were got in by traders who be able to avoid the capital controls — e.g., dual nationals having bank accounts in India as well as out of the country. The Bitcoin was also mined by native residents — usually in the initial days of the technology, before mining controlled widely.

With the Indian crypto market mainly cut off from those overseas, the price of Bitcoin on Indian trading platforms was constantly about 10% higher than huge universal peers. Related premiums have been perceived in different countries with severe capital controls, like South Africa and Brazil.

What can be the Future of Crypto Trading in India after RBI’s Ban?

India is not the only one contender in the list of countries which are prohibiting Bitcoin or other crypto coins. It is actually on the number 8 to do so.

• China was also cracking down on crypto trading platforms and ICOs throughout the last quarter of 2017.
• South Korea prepared its law very strict but have no purpose to ban cryptocurrency.
• Australia is also assembling new conventions for crypto exchanges.
• The US banks are banning credit or debit cards buying crypto coins as well as crypto exchanges being licensed. US SEC being thoughtful on crypto regulations.
• Japan is also licensing crypto exchange platforms.

Just like China, India can also see an enormous bang in OTC (Over The Counter) trades through services such as LocalBitcoins. You will also witness an important spike in P2P offline trading. But it’s not sure how positive it would be for individuals who need to purchase or sell a major amount of Bitcoin. But one thing is certain, this will take place, and a giant underground market would prosper on it.

India will apparently be left behind when it comes to the race of a blockchain and crypto coin technology and can’t be the part of blockchain revolution. This step by the RBI will definitely shock plenty of newbies who have just come into the crypto market. They will left the market and never think to come back due to uncertainty.  

The Indian government might reestablish its opinion on crypto and might take a keener step by amending crypto exchanges over licensing. This will aid in recovery.