The Indian government is talking about regulation for Bitcoin and other cryptocurrencies. India supposedly wants to have a plan within six months.
Dna, India’s English news firm owned by Diligent Media Corporation, has reported on the upcoming regulatory decisions “The issue of whether virtual currencies or bitcoins should be banned, regulated or self-regulated has been deliberated for some time,” it explained.
In April, the government began to study Bitcoin and will soon have results. It is also studying cryptocurrencies generally.
Sathvik Vishwanath, CEO and co-founder of Unocoin, is reported to have said: “This won’t be a decision as such, but a recommendation, based on what has been told to us in the closed-door meeting.”
Co-founder of the leading Indian bitcoin exchange Zebpay, Sandeep Goenka, concurs about the government’s next step. He told Bitcoin.com: “They are setting up a task force which will take 6 months to come up with recommendations.”
It may sound as if India is embracing digital currencies but only on the way to asserting more control.
This is because India radically reduced paper currencies over the past year. The idea was to deprive the black market of cash, but the reality is that many poor people without bank accounts have had a terrible time raising cash necessary to pay their bills.
The government sees this as a necessary evil since it wants all Indians, even the poorest, to have bank account. This is on the way to doing away with cash entirely.
This is seen as the future according to the government, but once everyone has a bank account – and uses it – there is almost no limit as to high government can raise fees and taxes. People chained by their bank accounts will have no way of objecting.
This is not just happening in India but around the world. Governments generally want to go cashless. In India the middle classes have not launched serious objections because the middle classes are not enamored of India’s general corruption. They may only figure it out when it is too late.
India is bolstering and regulating cryptocurrencies, or at least that’s the plan. But given India’s larger strategy, sooner or later the government will collide with private currencies. It wants to control money, not let it expand freely.
First it will regulate currencies and then it will control them. Otherwise the India central bank will lose clout. The power that comes from control is very important. Without it, India will move backwards (or forwards) towards freedom.
This may happen anyway, but not without a prolonged fight.