Even a common person, who hardly goes through the news headlines or keep him/herself aware of the happenings occurring in their society or around the world by just watching a few top headlines on Television or Newspapers, can now understand cryptocurrency.
This is because of the recent news headlines on cryptocurrency both on TV and Newspaper as well as on digital media. Certainly, it wouldn't be wrong to mention that more than Gross Domestic Product (GDP) and fuel prices, the word 'cryptocurrency' has managed to be in the headlines of the top media outlets and the reason is government.
Notably, for the past few days, a lot has been revealed and said about cryptocurrency but before diving into the topic, let us understand that what the Indian government has in its mind regarding the cryptocurrency future.
Indian Government on Crypto
Fearing that cryptocurrency could be misused in future or will spoil youngsters, the government has announced to introduce a bill in the upcoming winter session of parliament which is scheduled to kick off on November 29.
The bill named the cryptocurrency and Regulation of Official Digital Currency Bill, 2021 will most probably prohibit private players in the industry but at the same time there are reports that the government will not ban it completely but it will regulate. How far this information is true can only be cleared in the winter session of the parliament.
Now, after understanding the governments take crypto; let us look at how the rest of the world is regulating cryptocurrencies.
Since, United States (US) does not consider cryptocurrencies as a legal tender; here the respective exchanges are required to obtain a license to operate. Notably, a recently passed infrastructure bill includes a provision for taxing crypto trades but eventually, the provision came under huge criticism.
However, different states in US have different regulations for cryptocurrencies.
The neighbouring country of India, China has banned crypto exchanges from operating in the country. Apart from this, the country has also banned crypto mining. As per reports from various sources, the country is working on digital Yuan to replace existing cryptos.
Though India's friend Russia has allowed crypto exchanges to operate in the country as well as its mining apart from allowing to hold and trade cryptos but at the same time it has restricted cryptos for payments. Reportedly, the Russian government is mulling to create its own regulated digital currency.
In South Korea, investors are free to invest and trade in crypto, however, crypto exchanges require license to operate in the country.
The country is mulling to levy 20 percent tax on income earned from crypto transactions.
In Japan too, crypto exchanges are require license to operate despite it recognizes cryptocurrencies as legal property under the country's payment services act. The country also levies taxes on the income from cryptos.
Here the regulations on cryptocurrencies vary across different members of the union, however, digital currencies are widely considered legal across the union.
Since, in Australia exchanges are allowed to freely operate after registering with the Australian Transaction Reports and Analysis Centre. However, income from the crypto are classified as capital gains and taxed accordingly. The country has classified cryptos as legal property.
Crypto Markets Dip on Wednesday:
As soon as the Union Government announced to introduce a bill on cryptocurrency in parliament in the upcoming winter session, which seeks to ban private players in the country, the prices of all cryptocurrencies crashed by 15 percent.
Reportedly, all major cryptocurrencies such as Bitcoin, Ethereum etc saw buying dip in India as it witnessed a fall of around 15 per cent and more on November 23.
Commenting on the same, the WazirX CEO Nischal Shetty asserted that on Tuesday night crypto market saw nearly 15-20 percent crash in prices as the investors engaged in crypto panic selling.
However, he also admitted that presently, the market is recovering and is at a 3-4 per cent discount currently.
''People in India who have entered the market for the first time are scared now. However, we have suggested people to wait for the parliament's winter session and derive a conclusion based on it,'' he added.
Notably, a week ago, Prime Minister Narendra Modi had that all democratic countries need to work together on cryptocurrency and ensure that it does not end up in the wrong hands.
Giving an example of the virtual currency, he said, "Take cryptocurrency or Bitcoin for example. It is important that all nations work together on this and ensure it does not end up in the wrong hands, which can spoil our youth''.
Notably, currently, there is no regulation of cryptocurrency in India.
According to a report by BrokerChooser, in our country, more than 10 crore people have cryptocurrency which is the highest in the world. With this figure, India has left America, China, England and other countries of Europe far behind. 7.3 percent of India's population has crypto holdings.