The Indian government is preparing to ban Bitcoin and others

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The request of the Central Bank of India, formally sent to the Indian Government, could cause panic in the cryptocurrency market. If approved, the measure would make it illegal to hold Bitcoin illegally for residents of one of the world’s most populous countries. Thus, it would not be excluded that some citizens and investors who hoped to increase their wealth by investing in cryptocurrencies to give up their assets, putting new pressure on lower prices, according to Go4it.

Already, investment funds that have invested colossal sums in hopes of converting the projected increases in Bitcoin quotes into a quick profit have gone bankrupt. Only one of them, the Celsius Network, confirms billions of dollars in investor funds. But large-scale losses threaten not only the prosperity of greedy investors, but even global economic stability, with world governments considering increasingly brutal measures to tighten controls or even ban cryptocurrencies.

The prospect of illicit use, such as money laundering and the invisible transfer of wealth abroad, is another serious concern for nations where the “underground economy” accounts for a significant share of the total. The notion of underground economy refers to illegal economic activities, with illegal products and services, or with legal products or services obtained as a result of operations involving tax evasion.

If approved by Parliament, the Central Bank of India’s request would de facto ban cryptocurrencies, criminalizing the possession, issuance, extraction, trading and transfer of cryptocurrencies.

But even as it prepares to ban Bitcoin and its alternatives, the Indian government is building a legislative framework for an official digital currency, the use of which can be strictly controlled, preventing its use for speculative purposes or other illegal activities.