India, one of the largest and most powerful countries in the world, has published a clarification regarding the legal status of cryptocurrencies in its own country. In recent years, many companies based in India have had to cease operations due to increasing regulatory pressure. Now the Reserve Bank of India (the country’s central bank) has published a statement on the current legal status of crypto-currencies.
The RBI stated that Bitcoin (BTC) and other cryptocurrencies are indeed not prohibited for the general public. However, this does not mean that banks and other financial institutions can use them or offer related solutions. Indeed, RBI stated that banks and other companies are prohibited from using them. The main objective behind this decision is related to the fact that this could ultimately prevent money laundering, terrorist financing and more. The Financial Action Task Force (FATF) has issued a variety of rules for companies and corporations from around the world to track and reduce the use of virtual currencies for criminal activities.
The report published by the RBI states that they want to reduce the impact of the involvement of financial companies in activities that could entail greater financial risks. The report states as follows:
“RBI has been able to decouple the companies it supervises from participating in activities that entail reputation and financial risks in addition to other legal and operative risks.”
Crypto currency exchange and other companies offering crypto-related services have left the country. In the meantime, many others have had to cease their activities due to the regulations that have been introduced. Banks and other financial institutions were unable to provide these companies with the necessary services to handle cash and fiat currencies on behalf of their customers. Although the Indian central bank has taken a very tough position on virtual currencies, some block chain companies are emerging in India. Distributed Ledger Technology (DLT) can be very useful for a variety of activities and companies. This is why it is so important for many countries.
There are other jurisdictions around the world that have already created very friendly regulations and legal frameworks for digital currencies and block chain technology. These countries include Switzerland, Singapore and Malta. Crypto companies, stock exchanges and other companies are beginning to relocate their activities to these locations and operate in a regulated space.
Binance launches WazirX as a token on Binance Launchpad
Just hours after the announcement, Binance launched a token sale for its latest acquisition, the Indian crypto money exchange WazirX (WZX). In November, Binance bought Mumbai-based WazirX for $5 to $10 million. “One of the main objectives is to expand Binance with additional Fiat currencies and to work with local partners to add as many Fiat to crypto pairs as possible,” said Binance CEO Changpeng Zhao at the time.
WazirX was founded in March 2018 and has a monthly trading volume of $30 million and more than 200,000 app downloads. The acquisition of the peer-to-peer exchange enables Binance to gain a foothold in India and access to a market of over 1 billion people via a fiat onramp for the Indian rupee. The news of the introduction of WazirX as a token on Binance Launchpad was enthusiastically welcomed by some who praised WazirX as “Binance of India”. The exchange also announced an Airdrop free token.