India Seeks to Establish Crypto-Based Banking InstitutionsNovember 11, 2020
India is looking to potentially set up cryptocurrency-based banks within its borders. This creates a rather interesting scenario in that the country cannot seem to decide if it wants to ban crypto transactions for the future, though until that decision is made, it’s going to cash in on everything crypto has to offer.
Will India Have a Ban or Won’t It?
Recently, the ban that was in place in India – one that prevented banks from working with crypto-based businesses and applications – was deemed unconstitutional by the country’s Supreme Court. Once the ban was lifted, it was deemed that India would suddenly become a major haven for digital asset activity, though now, legislators are allegedly looking to ban all crypto activity in the coming future.
Many looked down on this idea, believing that it would put India behind its many Asian neighbors who are now looking to regulate cryptocurrencies rather than ban them outright. Either way, it’s going to be a while before such a final decision is made, and India is looking to set up a whole new branch of its financial spectrum before caving in.
The idea of a crypto-based bank has initially been established already through the idea of an exchange. However, this one would be a little bit different. While an exchange offers trading and purchase options, a full bank will offer custodial services, insurance and everything else that a financial company in good standing should offer.
In addition, people will also be able to take out loans against their crypto and make respective deposits and payments in cryptocurrency. Some are wondering that if banks begin to accept crypto fully, the ban may never be initiated.
Why Crypto Banks Are the Future
Nischal Shetty – CEO of Indian crypto exchange Wazir X – explained in a recent statement:
There is no ban on crypto in India. There was a banking restriction, which has been quashed by the Supreme Court of India in March 2020… We believe that in the next six to 12 months, crypto banking will become a reality. One of the major reasons behind it is that banks across the globe are already jumping into providing crypto services, especially in the US. JPMorgan already shared its intent about providing crypto services, while PayPal, a fintech giant, has announced its crypto service offerings. Square is already providing crypto services to their customers in the US. Recently in Singapore, DBS bank announced their own crypto exchange. We believe that a couple of banks will start providing crypto services to its customers.
Should this occur, there is no doubt that crypto would hit a whole new level of mainstream respect. Digital assets would garner as much legitimacy as credit cards and fiat currencies, and the global financial industry would change forever.
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