Developing Nations Refuse to Accept Crypto Fearing Competition
Back in 2018, India’s central bank, the Reserve Bank of India banned all banks from offering their services to cryptocurrency companies. Exchanges eventually had to shut down as they were no longer able to offer their services. While there is no ban on cryptocurrencies, their influence has become lower. India waged a war on cryptocurrencies.
India is a developing nation with a population of more than 1 Billion people. Similarly, China also has a population of more than 1 Billion people. The only way these countries force their will on its people is through money. While India is a democracy, it has taken an authoritative stance similar to china when it comes to money.
After the banking ban by the RBI, some crypto exchanges took the central bank to court. After months of arguments, the RBI finally agreed that it is scared of losing its authority.
The RBI argued that it has the sole right to operate currency and credit system in the country. It sees any other form of currency in the country as a threat. RBI even went a step further and stated that it would not allow Virtual Currencies such as Facebook’s Libra to operate in the country. RBI confessed that cryptocurrencies could undermine the faith and trust in digital systems.
The Indian economy is in a dire state right now due to years of mismanagement, and the unemployment rate is at a new low. Demonetization, an act where RBI invalidated all currency notes failed to even remotely meet its goals. It only managed to inconvenience its people and further slow down the economy. At such state, the government is scared of any competition.
In contrast, most developed countries have taken a crypto-friendly stance. Japan has even declared Bitcoin as a legal tender. People in developed nations already have access to safe money. For those in the developing nations, they are at the mercy of their central banks. These central banks fear losing their authority as cryptocurrencies gain popularity.
Published at Wed, 15 Jan 2020 12:20:48 +0000
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