To understand cryptocurrency, let us see how we got where we are.
March 2020, a historical moment in the journey of cryptocurrency, when the Supreme Court of India quashed the order passed by RBI in 2018 to ban financial services firms from trading in cryptocurrency or virtual currency. To understand this decision more, let us have a look at the crypto timeline in India; its past, its present and its future. The cryptocurrency market has always been questioned, analyzed, speculated but has always bounced back, hitting an all time high, every single time.
2008: “Bitcoin: A Peer to Peer Electronic Cash System”
A paper on cryptocurrency was published by a pseudonymous developer by the name of Satoshi Nakamoto. It described a version of electronic cash which would allow online payments to be sent directly from one party to another without going through a financial institution. This was the first paper to talk about Bitcoin. Although, not the first to mention cryptocurrency. The early work on cryptocurrencies can be traced back to the 1980s but it did not come to actualization since e-commerce had not fully evolved by then.
2010: First Bitcoin Transaction
Cash value was attached to cryptocurrency for the first time! A user swapped 10,000 Bitcoin for two pizzas marking the first actual sale of an item using cryptocurrency.
2011: Emergence of other Cryptocurrencies
Other cryptocurrencies like Litecoin, Namecoin and Swiftcoin emerged in the market. This year also saw a lot of controversies over claims of cryptocurrency being used on the dark web to procure drugs, guns amongst other things.
2012–2017: Multiple Cryptocurrency Exchanges Cropped up in India
Cryptocurrency suddenly saw a lot of interest from the Indian market, as well as the global players. As a result, Bitcoin grew from $5 to almost $1000 by the end of 2017. People were talking about it and the financial institutions were taking notice, feeling almost threatened. This time period also saw a lot of cryptocurrency exchanges crop up in India.
People were not surprised when RBI issued two massive statements, the first one dated December 24, 2013. It said,
1. Virtual currencies are not backed by a central bank.
2. Their value isn’t underpinned by an asset and thus a matter of speculation.
The second press release repeated the concern on February 1, 2017. It highlighted,
“It’s thus safe to assume that the crypto boom that followed 2016’s demonetization was an unintended consequence of that particular experiment. The emphasis on digital payments led to a search for alternatives to traditional online banking and drove tech-savvy customers to cryptocurrency exchanges.”
October and November of 2017 saw 2 separate PILs filed in the Supreme Court one asking it to ban buying and selling cryptocurrencies in India, the other asking for them to be regulated.
The government formed a committee to study the virtual currencies and propose actions.
December 2017 saw a bunch of statements issued from RBI and Ministry of Finance comparing the cryptocurrency to a scam but its popularity only kept increasing across the world.
2018: Trading Volumes Fall
April 2018
RBI issues a circular preventing commercial and co-operative banks, payments banks, small finance banks, NBFCs and payment system providers from:
-Dealing in virtual currencies
-Providing services to all entities which deal with them
Unable to access banking services in India, crypto exchanges find their businesses wiped out overnight. Trading volumes saw a massive plunge by almost 99% and by August 2018 about 95% of jobs came to an end.
May 2018
Faced with an existential crisis, several exchanges filed a writ petition in the Supreme Court.
2019: Committee Submits the Report
Two years later, the committee submits its report, recommending a ban on “private cryptocurrencies” in India.
2020: Supreme Court Quashes the Ban on Cryptocurrency
March 4, 2020
Monumental day for cryptocurrency in India.
SC quashes RBI’s ban on Cryptocurrency Trading, terming the April 6, 2018 circular unconstitutional. The Supreme Court said, the cryptocurrencies are unregulated but not illegal in India. This coincides with a crypto boom. Exchanges witnessed a sharp increase in interest and the price of Bitcoin jumps more than 700% in the next one year.
2021: Bill Proposed by Government of India
January 2021
The government of India will work on a bill to create a sovereign digital currency.
April 2021
After SC’s favourable ruling, a lot of global crypto platforms are seeing India as a major player with educated investors. Making the most of this opportunity, European’s most popular and award winning cryptocurrency exchange platform, Coinsbit launches in India as Coinsbit India. It is definitely an exciting time to learn and invest in cryptocurrency in India, when the market is just booming, compliances are being formed and regulations are being put in place for everyone’s safety.
About Coinsbit
Coinsbit India is a joint venture between Cryptic Coinsbit India and Prof-it Limited, intending to bring the best cryptocurrency exchange platform to India. With its headquarters in Estonia, the popular cryptocurrency exchange platform has a reported user base of 5 million users and a monthly transaction volume of around $30 billion-plus USD. It was named the best 2018 crypto exchange at Asian Blockchain Life, 2019.. Their strengths include well-timed order execution, local market insight, and multi-tier crypto asset security management bringing a full suite of services that a blockchain and a global exchange provides to the users.
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