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India Announces It Will Make All Cryptocurrency Payments Illegal

“It will however encourage the use of blockchain technology in payment systems”

India’s Finance Minister Arun Jaitley has announced in his budget speech yesterday that the government does not support cryptocurrencies as legal currency, and will seek to curb down on them as a payments method. It will however encourage the use of blockchain technology in payment systems.

“The government does not recognise cryptocurrency as legal tender or coin and will take all measures to eliminate the use of these cryptoassets in financing illegitimate activities or as part of the payments system,” Jaitley said.

The government’s stance on cryptocurrency trading is not clear, and we do not know if it will be banned in India. Nonetheless, this news contributed to a fresh fall in bitcoin prices, which is currently trading at USD 8,671 at the point of writing. It was trading around USD10,000 a few days ago.

Monish Panda, founder of Monish Panda & Associates law firm, has forecasted in an interview with Quartz India that cryptocurrency trading will be made illegal. He said:

“The government will now either come out with a legislative mechanism or make suitable amendment in existing legislation to ensure that dealing and trading in cryptocurrency is made illegal and to penalise entities and individuals who are involved in their trade and circulation.

The Indian government has not banned the trading of cryptocurrencies, but have traditionally been outspoken on the risks involved in cryptocurrency trading. It has previously labelled such trading activities as “Ponzi schemes”, warning citizens to be careful of their investments.

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