Bitcoin and other cryptocurrencies are trading at a discount in India after the country’s government listed a cryptocurrency bill in parliament for discussion yesterday.
At the time of writing, bitcoin is traded at WazirX for around 40,90,000 Indian rupees (around $ 54,900) compared to $ 56,750 on Binance – a difference of over 3%, which is significant.
The discount was over 15% last night and earlier this morning on various Indian crypto exchanges, but it seems to be narrowing now.
Some users are selling their cryptocurrencies in a panic after Lok Sabha – the lower house of India’s bicameral parliament – published a bulletin showing a crypto bill for discussion, Sharan Nair, business manager at CoinSwitch Kuber, told The Block.
The bill’s description in the bulletin states that it “seeks to ban all private cryptocurrencies in India, but it allows for certain exceptions to promote the underlying technology of cryptocurrency and its use.”
The definition of private cryptocurrencies and the contents of the bill are not yet known.
There are some new reports that say that private cryptocurrencies are privacy coins like monero, and not broader coins like bitcoin and ether. But an industry source told The Block that private cryptocurrencies are all cryptocurrencies that are not issued by the government, ie all coins except central banks’ digital currencies. This source said that they have clarified it from government sources.
Earlier today, CNN-News18 reported, citing “sources in the security establishment,” that the government will not ban crypto anyway.
“A regulatory mechanism will be in place so that crypto is not misused,” the sources told the publication. “The government is concerned about the underground transactions taking place against cryptocurrency – especially its role in ‘hawala’ and terrorist financing.”
“A strict mechanism will be in place so that law enforcement agencies can trace the origins of cryptocurrencies used for illegal or anti-national work,” the sources added.
This is not the first time cryptocurrencies in India are being traded at a discount, CoinSwitch told Cubers Nair. Prices fell significantly in 2017, when the late Arun Jaitley, then India’s finance minister, said the government did not recognize bitcoin as a legal tender, Nair said.
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