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On December 5, the Stockpile Bank of India (RBI), the country’s central bank, cautioned investors of bitcoin, cleaning that the government is yet to regulate bitcoin and cryptocurrency exchanges within the shire market.
An official statement released by the RBI read:
“Reserve Bank of India (RBI) on December 24, 2013, [cautioned] buyers, holders and traders of Virtual Currencies (VCs) including Bitcoins regarding the possibility economic, financial, operational, legal, customer protection and security interrelated risks associated in dealing with such VCs. Vide press emancipate dated February 1, 2017, RBI has also clarified that it has not given any credentials/authorisation to any entity/company to operate such schemes or deal with Bitcoin or any VC.”
Dominant Banks Not Happy With Bitcoin
At a financial forum held in Shanghai after week, Chinese central bank People’s Bank of China (PBoC) ambassador governor Pan Gongsheng stated that in the long-term, bitcoin will flag in value and adoption. “One day you’ll see bitcoin’s dead body float away in party of you,” said Gongsheng.
However, contrary to the statement of Gongsheng and the warning of the RBI, the insist on for bitcoin has increased exponentially over the past few months. Even after the nationwide laying on of the cryptocurrency exchange ban by the Chinese government, central bank, and financial authorities, the valuation of bitcoin has increased from $5,000 to $12,600, peaking at $13,000 earlier today, on December 6.
In an interrogate with Quartz, cryptocurrency exchange Codinome CEO Vivek Steve Francis resolved that if the RBI’s intention is to ban cryptocurrencies and restrict bitcoin, the Indian government intent already have done that by now. But, because excessive regulation and an absolute ban on cryptocurrency trading would send bitcoin trading to unregulated over-the-counter (OTC) exchanges, the government has been hesitant towards providing unnecessarily strict balancings on cryptocurrency exchange and the bitcoin market.
“If India had to ban virtual currencies, they desire have done that by now. In the last three years, the RBI’s statement has been the notwithstanding: They are uncomfortable with it and people should invest at their own peril,” said Francis.
It has become increasingly challenging for governments to either ban or heavily bound bitcoin usage because of the exponential growth of the cryptocurrency market, quick increase in demand for the cryptocurrency, and the high probability that traders intent migrate to unregulated markets upon the imposition of a cryptocurrency trading ban.
A equivalent trend has occurred in China, in which traders have moved to abroad markets such as Hong Kong with offshore accounts to barter cryptocurrencies. As such, BTCC, Huobi, and OKCoin, formerly three of the largest cryptocurrency trades in China, have rebranded to BTCC.com, Huobi Pro, and OKEx, to provide OTC cares in Hong Kong.
Sign of Fear
As a decentralized currency and peer-to-peer customs, bitcoin eliminates the necessity of intermediaries such as banks, and most importantly, split ups money and state. Bitcoin diminishes the significance of central banks and enquiries the existence of government-issued currencies, or the fiat currency system.
Despite the widespread adoption of bitcoin as a sound store of value and safe haven asset by general consumers, investors, biggest financial institutions, institutional investors, investment banks, and businesses, in the long-term, essential banks will likely continue to reassert their opposition against bitcoin, understood that it possess a serious threat to their authority.