Over the past few months, local Indian Bitcoin exchanges including Unocoin have shown enormous growth, primarily due to the demonetization of banknotes and the financial crisis which subsequently hit the Indian economy.
In November and December, Unocoin hit record-breaking trading volumes, reaching the highest total monthly Bitcoin trading volume in November. The company also announced that it obtained the most users in a month in November, after the announcement by Indian Prime Minister Narendra Modi to impose strict financial regulations.
Rapid growth of the Bitcoin industry in India
Belfrics, a Malaysia-based Bitcoin service provider and exchange, expanded its operations into India to strengthen the Bitcoin infrastructure and trading ecosystem of the country.
Recognizing the rapid growth rate of local Bitcoin exchanges, Belfrics decided to expand its services to India to ensure the general population of India has a wider range of Bitcoin service providers and trading platforms to choose from. The entrance of Belfrics into the Indian Bitcoin exchange market is expected to create solid competition for local Bitcoin exchanges.
Praveen Kumar, CEO of Belfrics, told a local publication in India during an interview that he is optimistic about the growth of the Bitcoin industry and the status of regulatory frameworks within the country. He firmly believes the Indian government is taking an appropriate approach in regulating both the Fintech and Bitcoin industries.
Bitcoin is a decentralized network, impossible to shut down
Leading Bitcoin exchanges including Zebpay also published various research papers on the legality of Bitcoin in India. The Centre For Internet & Society (CIS) and Nishith Desai Associates, a major law firm in India, have both concluded that Bitcoin is not illegal under any existing laws.
“Although Bitcoins can currently be classified only as movable property and more specifically as computer software, this position is not tested in a court of law,” said CIS. The organization also noted that Bitcoin is a decentralized network of peer to peer users and that even if the government wanted to shut it down, it wouldn’t be physically possible.
“An argument is made that even if the agencies want to regulate or shut it down they will not physically be able to do so as there is no nodal institution that the authorities can go after.”