India sometimes can be a confusing place to conduct business. Often, the government policies direct you in a different direction as compared to the implementation of it all. Our life feels like an irony sometimes. An example is the whole situation around Bitcoin in India.
I've stated on an earlier occasion that a central bank issuing a warning against virtual currencies is akin to saying the sky is blue. It's obvious that cryptocurrencies are a disruptive force to the 'business as usual' established by some of these archaic and corrupt institutions in power, not only in India but across the world.
Some cryptocurrencies like Bitcoin was started to with an aim to break down these barriers of trade and commerce. It was conceived to make this process easier, safer, cheaper and affordable for anyone to do bank globally, without having to deal with insurmountable paperwork. Whether or not it accomplishes this is another discussion altogether.
That said, Indian government isn't open to change in all aspects. The rising crypto adoption in the country is proof of their hesitance to make official comments on legalising it. Recently, I shared information about the I-T department in India conducting raids on several top crypto-exchanges in the country. They have amassed information about all the big players trading in Bitcoin through legal channels.
My point is that all of the current exchanges operating within the geographical confines of India are operating under license and regulations of the Indian government. They are operating freely without any restriction on trade or trade practices. Ofcourse, they have to mandatorily do KYC for all their clients but that is absolutely fine.
Since this fact has been established, it makes me wonder that-if these crypto exchanges are licensed for trade by the government, and the government chases us for tax by issuing over 500,000 tax notices to Bitcoin traders in the country to pay up capital gains tax, then technically, well atleast hypothetically it means to me that Bitcoin is Legal in India.
If it were illegal, the exchanges wouldn't have been allowed to operate. It is the job of the I-T department to tax legal or illegal businesses but it is up to the law enforcement agencies to curb any particular type of business. Let me reiterate that there is no such rule that stops any crypto exchange in the country from functioning normally.
All of this means to me that: My government likes us to continue feeding it through various channels and it will do so whether we like it or not. Hopefully the framework around cryptos will be released in this century as Indian government is not known for it's pace of work unless ofcourse there is some money to be made. Luckily for us, there's a lot of money surrounding cryptocurrencies so we're probably in the good for now!
Perhaps I sounds a little harsh, but then I suppose some criticism was long over due!
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