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India’s crypto future remains uncertain.
Crypto remains a heated topic in India as the new bill appears to be delayed again.
The bill is listed for the winter session of the Parliament, which will end on Dec. 23. It is unlikely that the bill will pass by that time. Moreover, a similar statement was also listed for earlier sessions this year.
The government is reportedly considering more changes to the proposed bill. However, sources also cited needing more time to consult more stakeholders before reaching a decision.
It seemed that India would ban all “private crypto” back in November. That means a ban on all crypto outside of central banks’ control. However, India has since shifted its policy, following criticism from the public.
The move followed a similar decision recently. Last month, the government decided to rework the crypto bill. While speaking to the Parliament, Finance Minister Nirmala Sitharaman tried to explain the policy shift. She said that crypto was changing and that the government needed to take that into account.
The earlier attempt was definitely to come up with a Bill that the house can consider. But, later, because rapidly a lot of things had to come into play, we had started working on a new Bill.
The original draft of the bill came out back in 2019.
Reports also say that India is discussing creating the central bank digital currency (CBDC). This framework likely includes crypto regulation and potentially a ban on some cryptos.
Reserve bank of India (RBI) governor Shaktikanta Das also expressed other concerns about crypto.
Cryptocurrencies are a serious concern to RBI from a macroeconomic and financial stability standpoint
As a result, despite all the criticism from investors, the RBI remains in favor of the complete ban on private crypto.
Furthermore, Indian PM Narendra Modi expressed other concerns with crypto alongside economic reasons.
At the Summit for Democracy, a virtual summit hosted by the U.S., Modi said crypto could undermine democracy.
We must also jointly shape global norms for emerging technologies like social media and crypto-currencies, so that they are used to empower democracy, not to undermine it.
Last month, investors panicked over a potential ban. Panic selling made crypto crash, with Bitcoin falling 14,8% on the WazirX exchange only a few hours after the news. Ethereum likewise fell by 15% and Tether by almost 18%. The panic selling since subsided.
However, even some insiders later reacted negatively to the harsh bill. This includes former Finance Minister Subhash Garg, who authored the original bill back in 2019. However, after he changed his stance on crypto. In July 2020, he stated that the government should permit crypto and treat them as commodities. Last month, Garg commented on the announced bill, calling it a mistake. Likewise, he called digital currencies are a “useful tool for humanity”.
Moreover, crypto came into the focus again when hackers took over Narendra Modi’s Twitter account. Hackers linked to a potential crypto scam from his account for a brief period. The post also stated that Bitcoin is becoming legal tender in India.