14 ms·

India proposes law to ban cryptocurrencies, create official digital currency

134 points by m33k44 6y ago

bitxbitxbitcoin 6y ago
I would actually like to see a nation state try to ban private cryptocurrency use. How would they do it?
- deleted 6y ago
  [deleted]
- ripvanwinkle 6y ago
  They would essentially drive it underground so that if you bought or sold or transacted in crypto you would have to do it through the equivalent of dark alleys or obscure smoke filled venues. Something like the contrast between trying to procure cocaine vs aspirin
  - PointyFluff 6y ago
    Woooo! spooky VPNs....
  - thysultan 6y ago
    It will be easier than you think: You could just send crypto to a friend and they wire me the equivalent in $ with india being non-the-wiser.
    - randomopining 6y ago
      But how do you know the price? Much less price discovery. Would it be easy to transact OTC like that?
    - Ekaros 6y ago
      If I were a state I would make bank to track those wire transfers. A sufficient amount of them without reason would make authorities ask questions... Like are you running some sort of business or something? Why aren't you paying us taxes that you potentially owe?
lazypenguin 6y ago
I love when you get little glimpses like these into the mindset of leadership and realize they are just ordinary people who don't know what they're doing either. I'm not a crypto enthusiast but even I have to chuckle and shake my head at situations like this. An official cryptocurrency run by the Reserve Bank of India defeats one of the main selling points of a decentralized cryptocurrency...
- m3kw9 6y ago
  Digital currency can different than crypto currencies. The point is they want centralization.
  - omk 6y ago
    Digital currency is no different that what already exists in terms of digital representation of one's holding. Really curious to see how the tax payer is going to pay for a glorified database and what value is derived from it.
    - deleted 6y ago
      [deleted]
    - ampdepolymerase 6y ago
      How fast is clearing and settlement in traditional Indian banking?
      - geektips 6y ago
        It depends on the system used for transaction[0]. For transaction under $1300 settlements are instant, while for amount more than that it ranges from 30 minutes to 24 hours. [0] https://en.m.wikipedia.org/wiki/Payment_and_settlement_systems_in_India https://en.m.wikipedia.org/wiki/Payment_and_settlement_syste...
        manquer 6y ago
ve55 6y ago
More regulation is coming for the US as well, so it's something to be prepared for. There's going to be some interesting times ahead.
thweor23439879 6y ago
Hardly surprising - India has been at the forefront of this insane "digital cash" only agenda that is being pushed worldwide. Their policies are almost always set by flown-in experts from the US and by random NGOs and compromised bureaucrats, who almost always give the same advice. Little wonder that even with the pompous BJP at the helm, all they can manage to do is implement policies that they themselves had blocked the previous set of kleptocrats from implementing earlier.
- reactspa 6y ago
  Your comment is going to be an underrated comment. However, there's also the notion of "tracking corruption". China apparently is a cashless society (according to a Chinese person I interacted with recently). I'd imagine that if it's good for China, it's good for India. (Indian here.)
  - manquer 6y ago
    Lot of countries are effectively going cashless by design or by market forces. It is convenient and cheaper for everyone. It is not necessarily better for privacy or human rights, it can be better for taxation and other government functions. Whether anyone likes it or not, the world is moving towards this model. It is better to have controls and regulations on how the data will be used rather fighting about keeping cash.
    - MisterSandman 6y ago
      > It is convenient for everyone Maybe in a semi-ideal world, but not in a country like India. Less than 30% of Indians own a Smartphone, which is where a lot of the "convenience" of going cashless comes from. The Indian government made a recent (superficial) push to get up to 80% of Indians a bank account (up from ~50% form a few years ago), but it doesn't take a FAANG engineer to realize that the majority of these people don't have easy access to banks, banking apps and especially something like crypto. Going "cashless" has tremendous negatives for the world's poorest. India's demonetization push, which forced people to exchange their old notes for new ones, is a clear case study of how major change to currency has a disproportionate impact on the poor. source for the bank account stuff: https://scroll.in/article/923798/over-80-now-indians-have-bank-accounts-how-many-are-actually-using-them https://scroll.in/article/923798/over-80-now-indians-have-ba...
ripvanwinkle 6y ago
I am trying to understand what new scenarios a digital currency from India or any government unlock that are not possible today. Is it that if i wanted to pay someone I could just skip the intermediate credit card / google pay/ bank account and just send money p2p. love to learn more here.
- dschnurr 6y ago
  Gov-supported digital currencies would mostly streamline things and replace existing bloated and slow programs. Imagine the current stimulus situation – instead of sending checks to people they could just press a button and immediately send credit to all citizens that have a certain account threshold or income rate. Currency units could be earmarked for certain retailers (i.e. food stamps, education, etc).
  - whiddershins 6y ago
    Press a button and instantly deduct a new tax from my bank account as well.
  - gus_massa 6y ago
    It's just a mandatory account in a National Bank[1] for everyone. With a debit card or an app in the phone, it's almost as good. The real question is why they need a new currency instead of using the current one? [1] I don't know the name. Here in Argentina we have a "National Bank", and also the "Central Bank" that is somewhat like the Federal Reserve, and a few other national banks that are privatized and nationalized back from time to time. Also each Province has it's own bank. (And there are also private banks.)
  - wtmt 6y ago
    There is no need to send checks to people unless it’s required for keeping records or purposes beyond money transfer. India has quite an advanced banking system where quite a large sum of money can be transferred in mere seconds or in several minutes round the clock anytime of the year from any bank to any other bank.
billfruit 6y ago
Possibly more urgent policy reforms/legislation required in India than this: 1. Codification of the law of Torts. 2. No-fault divorce. 3. More devolution of powers and policy making to states. 4. Ending the practice of Unelected Governers. 5. Remove power of the central government to dismiss elected state governments. 6. Dismantle the British Era civil service designed to preserve undemocratic control over the population to a modern federal system where all decision making authority lies with elected representatives only. 7. Repeal of colonial era police and criminal codes, and moving to a more humane police and criminal justice system as in other democratic countries, including the establishment of jury system. 8. Give equal representation all states in the upper house as in the US senate(2 senator s from each state).
- screye 6y ago
  > 4. Ending the practice of Unelected Governers. > 8. Give equal representation all states in the upper house as in the US senate(2 senator s from each state). I am sorry, but we certainly do not need the worst parts of the US system. It is not just bad. It is catastrophic. Having 2 elected houses is monumentally stupid idea that allows politicians to trap the system in blockages, while pointing fingers at each other for no repercussions. > Codification of the law of Torts. I hope this never happens. The super litigious part of America through civic laws leads to a lot of services getting needlessly expensive. ________ India has big problems, but almost none of them are the ones you mention.
  - lou1306 6y ago
    > Having 2 elected houses is monumentally stupid idea that allows politicians to trap the system in blockages, while pointing fingers at each other for no repercussions. A democratic system's main concern is not efficiency, but rather robustness of the democratic process. Authoritarian states are much more efficient in passing legislation, but at what cost?
    - screye 6y ago
      Democracy is about allowing people's representatives to effectively pass bills for which they put them in place. Building structures at actively make that difficult are not democratic. They are just bad.
motohagiography 6y ago
By ban, do they mean "create a massive grey/black market full of billionaire criminals," because that's literally what they're doing.
- coldtea 6y ago
  No, it just means of being one of the first goverments to take control of the cryptocurrencies, which will end up making these "billionaires" worth $0 (or "come clean" by paying big taxes for their money to transfer them to the official currency), and others who continue trading or offer support for it, go to jail.
  - suyash 6y ago
    Yes, think this is very innovative approach the Indian Govt, I support it.
  - TT3351 6y ago
    Very optimistic outlook for you to take towards a government which has taken even more drastic steps in the past aimed at corruption to (from what I can tell) limited effect and great disruption to non-corrupt citizens -- thinking specifically of demonetization. This seems like "big stick" policy to me, a hammer looking for a nail.
    - coldtea 6y ago
      Well, I never said this will make corruption more difficult, or even that it's aimed towards reducing it. Just that it will make cryptocurrency use/facilitation illegal, and thus prone to fines/jail time.
me551ah 6y ago
I think this is only the beginning, as bitcoin becomes more and more popular, countries are going to start becoming scared of it. Bitcoin cannot be controlled by the government and it is almost impossible to trace. There are bitcoin mixers available which can obfuscate transactions too. Black Money is a huge problem in India, and bitcoin transactions pose a major challenge to law and tax enforcement. As it starts to become a problem in other countries, I'm sure they will follow suit.
- PointyFluff 6y ago
  Illegal transactions are a much greater problem in fiat currencies.
- _muff1nman_ 6y ago
  Bitcoin is not only possible to trace, it is arguably becoming easier to trace than things like cash. In addition it has started to degrade in some of its decrentalizing aspects which opens up lots of vulnerabilities to being subverted by the government. One example is the supply chain of mining.
- Entwickler 6y ago
  "it is almost impossible to trace." I always struggle with this argument. Literally every tx is on the chain. Sure, they can obfuscate and make tracing more difficult, but the data is still there to be analyzed. At some point the user will likely try to receive the crptyo and cash out at an exchange, or purchase goods and services through a regulated entity like paypal. That's where the gov can scrutinize and take action, which is why KYC is in place at Coinbase and other US exchanges. To curb nefarious use across borders, seems like the problem may be that more exchanges need KYC laws across the globe, not just in USA, and there would need to be some interpol-like oversight. A globally public ledger seems like a tool, not a hindrance, against "Black Money". We just need more global cooperation and oversight between governments tracking the exchanges.
  - me551ah 6y ago
    If you use a bitcoin mixer then it cannot be traced. That's the whole point of mixers.
Abishek_Muthian 6y ago
My views on the ban on cryptocurrencies are same as an average HN user although I don't have any. But my views on official digital currency in India could be different i.e. I would welcome it. Just because if it enables in the distant future the ability to monitor where every paisa of my tax was spent on down to the lowest level e.g. It was used to buy the tiles for the construction of a public toilet in X village; it's certainly possible with blockchain.
- PointyFluff 6y ago
  Bitcoin is more of a holding; last-mile transactions are better made with different cryptocurrencies, such as Monero. With Doge being great for tossing around on the internet for the more trivial things.
- yinyang_in 6y ago
  I also feel the same, the digital brings transparency and blockchain can be used to track it entirely how paisa is spent if someone is willing in it. Still have to see how implementation is, we don't have to be pessimistic right awah Tomorrow BJP/CONGRESS can be tracked. Make political finding only by e-currency only for transparency sake. I don't like 1984 like scenarios but also e-currency is welcome step from my side too.
02020202 6y ago
that is the beauty of cryptocurrency - you cannot steal it away from people. haha.
bobbydreamer 6y ago
Nope. Not in anytime soon. India will wait and see what other countries do. Probably there will be a terrorist attack somewhere and they will find out he used crypto for everything and banning of crypto will stop. RBI said they are banning crypto few years back and people are still doing it, then found RBI didn't ban, they just requested people not to use it.
- yinyang_in 6y ago
  How will attack based on cryto will stop ban on crypto ?
  - bobbydreamer 6y ago
    It's a currency that govts don't have control on or back track
jackfoxy 6y ago
Consider this: Every Satoshi can be traced back to when it was mined. The IRS now requires Americans and resident aliens filing income tax returns to report on their crypto holdings. Lots (maybe most?) people use exchanges like CoinBase. (Remember, not your keys, not your coins.) If the government believes (they do not even have to prove) your Satoshis were ever used for illicit transactions, they can legally seize those assets. (Sorry, we don't think you were involved, but these coins are criminals.) To simplify things they just need to show a judge reasonable cause of structuring sometime in the coin's history. That has to be super easy to do. https://www.goldinglawyers.com/structuring-cash-transactions https://www.goldinglawyers.com/structuring-cash-transactions
- vmception 6y ago
  Structuring doesn't apply to cryptocurrencies and there is no reporting threshold to be avoided yet. There are some proposals to make thresholds. Structuring currently only applies to physical cash passing a boarder or physical cash entering or exiting a financial institution. It does not apply to institution to institution transfers of any type and it doesn't apply to cryptocurrencies at the moment. I’ve had this discussion before, FinCEN is trying to change that. Because structuring is a criminal law, they would need to show a court a bit more to convict. But before a conviction they could make your life complicated with dumb rationale to a judge for a warrant or seizure notice, and that has nothing to do with cryptocurrency, everyone relies on the government and private persons not making their life complicated.
  - jackfoxy 6y ago
    Yes. This would be new legal territory, but not radically new (IANAL). USG would certainly pick the case and the court to try it in carefully in order to establish the precedent.
    - vmception 6y ago
      Structuring regulations are very clear about physical cash in and out of a licensed financial institution (or avoiding declarations to customs). Most agencies and representatives have made it clear they aren't trying to debilitate bitcoin or bitcoin use. This fanfiction of the government not letting bitcoin be useful as a competitor is a weak argument mostly because the ship has sailed, about a decade ago.
divs1210 6y ago
Indian here. THIS is why India has been enslaved by foreign powers again and again. This is why Indians rarely innovate in India but outperform others abroad. Indian leadership SUCKS, and India will remain a third world shithole for the foreseeable future. I had some hopes from Modi, but now I don't. Not sure what kind of bad karma makes you reincarnate as an Indian, but my past lives must have been full of hedonism and debauchery. I hope.
- eschulz 6y ago
  I can't argue with you. However, I'm often unsettled when people envision such a gulf between them and the political leaders in their nation. I fear that this makes people say, "oh well, the government are idiots, but there's nothing I can do". I wish I knew the formula to improve state leadership, but I hope you never quit applying pressure to those in high office in India.
- rakejake 6y ago
  The real reason India is behind is because people like you and me are content dissing the country at every opportunity sitting in America.
teawrecks 6y ago
So basically, "We think it's time to steal the tech, ban any further innovation, and implement our own version that subverts the entire point of it to begin with"?
christiansakai 6y ago
Just wondering, I don't care much about cryptocurrency, but I do realize that we need cryptocurrency (as a side effect of blockchain) to make the blockchain secure (making it an incentive to run blockchain nodes). Assuming that indeed we as humanity need blockchain (and decentralization technology) in the future, can a blockchain or any other decentralization technology work without cryptocurrency (or any other incentive for that matter)? Any thoughts?
akhilkg 6y ago
I assume the thought process was something like this: Indian government looks at cryptocurrency and think "Ok so this is like UPI (digital money) - but I can't trace it and that's bad" - so boom - make an official cryptocurrency which they can trace back to and restrict all others. I don't know how good of a solution this is, but, defeats the point of crypto nonetheless.
- deleted 6y ago
  [deleted]
wtmt 6y ago
Firstly, consider that the Indian government believes every citizen and resident to be a crook and a tax evader unless proven otherwise. That’s why it has been pushing for “cashless” (even after the callous and disastrous demonetization exercise in 2016 that outlawed some currency bill denominations), linking taxpayers with a poorly designed and implemented non-revocable biometric based number (called Aadhaar), pushing for this flawed system to be used everywhere, etc. Next consider that the current regime has a charismatic leader who gets a lot of vociferous support for anything that can be spun into the “anti-terrorism” and “national security” angles. Since cryptocurrencies are only used by terrorists and tax evaders dealing in drugs and such (this is a sarcastic take here, but is believed so completely by the supporters of the government), they must be banned.
mythrwy 6y ago
If they pull both of these things off it may be bullish for precious metals. People will always want stores of value outside of monitored and adulterable (is that a word? hope the meaning is clear) centralized currencies. And the more trust is broken by the powers controlling the centralized currencies the more people will seek options to preserve and transfer wealth.
sub7 6y ago
They've already built BHIM and UPI. People think the government are a bunch of dumb babus but they're sharp as fuck and realized bitcoin is a virus and total lockdown early is best. If Indians want to go hold + transact cash in random BTC wallets then by all means they are welcome to do so illegally and subject themselves to scrutiny down the road.
option_greek 6y ago
Its quite clear why they want to do this at this point of time. The problem is the floating rate of USD/INR as seen by BTC/INR or any stable currency/INR is slipping like crazy since they started providing stimulus to economy last year. Its so bad, that there is a hair cut of around 8% regardless of the platform. This is only going to become worse as more money is going to be printed this year to get the economy back on track. No one can call out that the emperor is losing his clothes if they are terminated :)
azifali 6y ago
I think this is a needless and draconian proposal. If the government stops meddling with the constitutional rights of its citizen subjects, restore Right to Information (RTI), remove election fraud and fundraising which is tremendously boosting the currently elected government - they would have bestowed a huge favor to its citizens and the future generations.
specialist 6y ago
Has India banned other religions? Cue pearl clutching about slippery slopes.
jmsflknr 6y ago
Dupe: https://news.ycombinator.com/item?id=25968328 https://news.ycombinator.com/item?id=25968328
naruvimama 6y ago
To all Indian and non-Indians alike, a simple exercise will tell you a lot about the challenges the country faces from a security stand point. Enumerate all the countries around india,look at the political systems, demography, civil wars and genocide. India is a oasis in the region, to keep ot safe is a herculean task. And believe me you, until very recently the US and co often backed unsavoury elements animical to Indian interests due to political and strategic compulsions.
peter_d_sherman 6y ago
It will be highly interesting to see what happens here, and what the results are. Let's suppose, hypothetically, for the sake of reasoning about the future, that India passes this law. OK, so now India has an official, single, state-sponsored cryptocurrency, er, "digital currency". Well, India still needs the Internet to function to do that. If the Internet is still functioning, and we presume that it will be, then how are they going to block other cryptocurrencies, er, "digital currencies" from being transacted? Well, it could be China to the rescue! China's firewall "block out all other countries' Internet" technology that is! But if they use something like that, if they create a "walled Internet garden" in India, then what happens to Indian Citizens who travel abroad, and want to transact in India's digital currency? In fact, what happens if two people, who are not Indian, who are not located in India, want to create a transaction in the new Indian digital currency with one another? In other words, what are the rules of that game? What happens if you have two or more Indian Citizens, who have accounts with the new digital currency, who act as minature "bankers", (that is, to produce surety/insurance/act as a source of trust) who then underwrite contracts which can be paper or digital, where these contracts are detached from the system, and can be traded by any number of other people in any number of other countries? Make that practice illegal? You could -- but this is sort of how paper currency first became valuable -- because it could be used as a proxy for gold (the goldsmith being the party that brokers the trust). Also, it's sort of what commercial paper and stock markets and derivatives do... there's an underlying object of value, and then there's a piece of paper which grants some form of control to the underlying value, and a "trust broker" that guarantees that that relationship holds... Make that practice illegal and you've basically banned stock markets and commercial paper of all sorts. The banks and major financial players (who are well connected politically in whatever country we want to talk about) -- won't have that. So it'll be interesting to see how this plays out, if India can control it, or if, more than likely, "creative" people in the finance markets will find ways to game the system... Of course, the only other option is to let all of those uncontrollable digital currencies proliferate. I'd say that India, with respect to creating this digital currency, is "damned if they do, and damned if they don't"... In other words, there's no simple solution... But, on a positive note, 10+ years or so into the future, future historians and policy makers should be able to get a whole lot of information as to how this played out, what was negative, and what was possitive, the effects and ramifications...

134 points by m33k44 6y ago

bitxbitxbitcoin 6y ago

I would actually like to see a nation state try to ban private cryptocurrency use. How would they do it?

deleted 6y ago
[deleted]
ripvanwinkle 6y ago
They would essentially drive it underground so that if you bought or sold or transacted in crypto you would have to do it through the equivalent of dark alleys or obscure smoke filled venues. Something like the contrast between trying to procure cocaine vs aspirin
- PointyFluff 6y ago
  Woooo! spooky VPNs....
- thysultan 6y ago
  It will be easier than you think: You could just send crypto to a friend and they wire me the equivalent in $ with india being non-the-wiser.
  - randomopining 6y ago
    But how do you know the price? Much less price discovery. Would it be easy to transact OTC like that?
  - Ekaros 6y ago
    If I were a state I would make bank to track those wire transfers. A sufficient amount of them without reason would make authorities ask questions... Like are you running some sort of business or something? Why aren't you paying us taxes that you potentially owe?

lazypenguin 6y ago

I love when you get little glimpses like these into the mindset of leadership and realize they are just ordinary people who don't know what they're doing either. I'm not a crypto enthusiast but even I have to chuckle and shake my head at situations like this. An official cryptocurrency run by the Reserve Bank of India defeats one of the main selling points of a decentralized cryptocurrency...

m3kw9 6y ago
Digital currency can different than crypto currencies. The point is they want centralization.
- omk 6y ago
  Digital currency is no different that what already exists in terms of digital representation of one's holding. Really curious to see how the tax payer is going to pay for a glorified database and what value is derived from it.
  - deleted 6y ago
    [deleted]
  - ampdepolymerase 6y ago
    How fast is clearing and settlement in traditional Indian banking?
    - geektips 6y ago
      It depends on the system used for transaction[0]. For transaction under $1300 settlements are instant, while for amount more than that it ranges from 30 minutes to 24 hours. [0] https://en.m.wikipedia.org/wiki/Payment_and_settlement_systems_in_India https://en.m.wikipedia.org/wiki/Payment_and_settlement_syste...
      - manquer 6y ago

ve55 6y ago

More regulation is coming for the US as well, so it's something to be prepared for. There's going to be some interesting times ahead.

thweor23439879 6y ago

Hardly surprising - India has been at the forefront of this insane "digital cash" only agenda that is being pushed worldwide. Their policies are almost always set by flown-in experts from the US and by random NGOs and compromised bureaucrats, who almost always give the same advice. Little wonder that even with the pompous BJP at the helm, all they can manage to do is implement policies that they themselves had blocked the previous set of kleptocrats from implementing earlier.

reactspa 6y ago
Your comment is going to be an underrated comment. However, there's also the notion of "tracking corruption". China apparently is a cashless society (according to a Chinese person I interacted with recently). I'd imagine that if it's good for China, it's good for India. (Indian here.)
- manquer 6y ago
  Lot of countries are effectively going cashless by design or by market forces. It is convenient and cheaper for everyone. It is not necessarily better for privacy or human rights, it can be better for taxation and other government functions. Whether anyone likes it or not, the world is moving towards this model. It is better to have controls and regulations on how the data will be used rather fighting about keeping cash.
  - MisterSandman 6y ago
    > It is convenient for everyone Maybe in a semi-ideal world, but not in a country like India. Less than 30% of Indians own a Smartphone, which is where a lot of the "convenience" of going cashless comes from. The Indian government made a recent (superficial) push to get up to 80% of Indians a bank account (up from ~50% form a few years ago), but it doesn't take a FAANG engineer to realize that the majority of these people don't have easy access to banks, banking apps and especially something like crypto. Going "cashless" has tremendous negatives for the world's poorest. India's demonetization push, which forced people to exchange their old notes for new ones, is a clear case study of how major change to currency has a disproportionate impact on the poor. source for the bank account stuff: https://scroll.in/article/923798/over-80-now-indians-have-bank-accounts-how-many-are-actually-using-them https://scroll.in/article/923798/over-80-now-indians-have-ba...

ripvanwinkle 6y ago

I am trying to understand what new scenarios a digital currency from India or any government unlock that are not possible today. Is it that if i wanted to pay someone I could just skip the intermediate credit card / google pay/ bank account and just send money p2p. love to learn more here.

dschnurr 6y ago
Gov-supported digital currencies would mostly streamline things and replace existing bloated and slow programs. Imagine the current stimulus situation – instead of sending checks to people they could just press a button and immediately send credit to all citizens that have a certain account threshold or income rate. Currency units could be earmarked for certain retailers (i.e. food stamps, education, etc).
- whiddershins 6y ago
  Press a button and instantly deduct a new tax from my bank account as well.
- gus_massa 6y ago
  It's just a mandatory account in a National Bank[1] for everyone. With a debit card or an app in the phone, it's almost as good. The real question is why they need a new currency instead of using the current one? [1] I don't know the name. Here in Argentina we have a "National Bank", and also the "Central Bank" that is somewhat like the Federal Reserve, and a few other national banks that are privatized and nationalized back from time to time. Also each Province has it's own bank. (And there are also private banks.)
- wtmt 6y ago
  There is no need to send checks to people unless it’s required for keeping records or purposes beyond money transfer. India has quite an advanced banking system where quite a large sum of money can be transferred in mere seconds or in several minutes round the clock anytime of the year from any bank to any other bank.

billfruit 6y ago

Possibly more urgent policy reforms/legislation required in India than this: 1. Codification of the law of Torts. 2. No-fault divorce. 3. More devolution of powers and policy making to states. 4. Ending the practice of Unelected Governers. 5. Remove power of the central government to dismiss elected state governments. 6. Dismantle the British Era civil service designed to preserve undemocratic control over the population to a modern federal system where all decision making authority lies with elected representatives only. 7. Repeal of colonial era police and criminal codes, and moving to a more humane police and criminal justice system as in other democratic countries, including the establishment of jury system. 8. Give equal representation all states in the upper house as in the US senate(2 senator s from each state).

screye 6y ago
> 4. Ending the practice of Unelected Governers. > 8. Give equal representation all states in the upper house as in the US senate(2 senator s from each state). I am sorry, but we certainly do not need the worst parts of the US system. It is not just bad. It is catastrophic. Having 2 elected houses is monumentally stupid idea that allows politicians to trap the system in blockages, while pointing fingers at each other for no repercussions. > Codification of the law of Torts. I hope this never happens. The super litigious part of America through civic laws leads to a lot of services getting needlessly expensive. ________ India has big problems, but almost none of them are the ones you mention.
- lou1306 6y ago
  > Having 2 elected houses is monumentally stupid idea that allows politicians to trap the system in blockages, while pointing fingers at each other for no repercussions. A democratic system's main concern is not efficiency, but rather robustness of the democratic process. Authoritarian states are much more efficient in passing legislation, but at what cost?
  - screye 6y ago
    Democracy is about allowing people's representatives to effectively pass bills for which they put them in place. Building structures at actively make that difficult are not democratic. They are just bad.

motohagiography 6y ago

By ban, do they mean "create a massive grey/black market full of billionaire criminals," because that's literally what they're doing.

coldtea 6y ago
No, it just means of being one of the first goverments to take control of the cryptocurrencies, which will end up making these "billionaires" worth $0 (or "come clean" by paying big taxes for their money to transfer them to the official currency), and others who continue trading or offer support for it, go to jail.
- suyash 6y ago
  Yes, think this is very innovative approach the Indian Govt, I support it.
- TT3351 6y ago
  Very optimistic outlook for you to take towards a government which has taken even more drastic steps in the past aimed at corruption to (from what I can tell) limited effect and great disruption to non-corrupt citizens -- thinking specifically of demonetization. This seems like "big stick" policy to me, a hammer looking for a nail.
  - coldtea 6y ago
    Well, I never said this will make corruption more difficult, or even that it's aimed towards reducing it. Just that it will make cryptocurrency use/facilitation illegal, and thus prone to fines/jail time.

me551ah 6y ago

I think this is only the beginning, as bitcoin becomes more and more popular, countries are going to start becoming scared of it. Bitcoin cannot be controlled by the government and it is almost impossible to trace. There are bitcoin mixers available which can obfuscate transactions too. Black Money is a huge problem in India, and bitcoin transactions pose a major challenge to law and tax enforcement. As it starts to become a problem in other countries, I'm sure they will follow suit.

PointyFluff 6y ago
Illegal transactions are a much greater problem in fiat currencies.
_muff1nman_ 6y ago
Bitcoin is not only possible to trace, it is arguably becoming easier to trace than things like cash. In addition it has started to degrade in some of its decrentalizing aspects which opens up lots of vulnerabilities to being subverted by the government. One example is the supply chain of mining.
Entwickler 6y ago
"it is almost impossible to trace." I always struggle with this argument. Literally every tx is on the chain. Sure, they can obfuscate and make tracing more difficult, but the data is still there to be analyzed. At some point the user will likely try to receive the crptyo and cash out at an exchange, or purchase goods and services through a regulated entity like paypal. That's where the gov can scrutinize and take action, which is why KYC is in place at Coinbase and other US exchanges. To curb nefarious use across borders, seems like the problem may be that more exchanges need KYC laws across the globe, not just in USA, and there would need to be some interpol-like oversight. A globally public ledger seems like a tool, not a hindrance, against "Black Money". We just need more global cooperation and oversight between governments tracking the exchanges.
- me551ah 6y ago
  If you use a bitcoin mixer then it cannot be traced. That's the whole point of mixers.

Abishek_Muthian 6y ago

My views on the ban on cryptocurrencies are same as an average HN user although I don't have any. But my views on official digital currency in India could be different i.e. I would welcome it. Just because if it enables in the distant future the ability to monitor where every paisa of my tax was spent on down to the lowest level e.g. It was used to buy the tiles for the construction of a public toilet in X village; it's certainly possible with blockchain.

PointyFluff 6y ago
Bitcoin is more of a holding; last-mile transactions are better made with different cryptocurrencies, such as Monero. With Doge being great for tossing around on the internet for the more trivial things.
yinyang_in 6y ago
I also feel the same, the digital brings transparency and blockchain can be used to track it entirely how paisa is spent if someone is willing in it. Still have to see how implementation is, we don't have to be pessimistic right awah Tomorrow BJP/CONGRESS can be tracked. Make political finding only by e-currency only for transparency sake. I don't like 1984 like scenarios but also e-currency is welcome step from my side too.

02020202 6y ago

that is the beauty of cryptocurrency - you cannot steal it away from people. haha.

bobbydreamer 6y ago

Nope. Not in anytime soon. India will wait and see what other countries do. Probably there will be a terrorist attack somewhere and they will find out he used crypto for everything and banning of crypto will stop. RBI said they are banning crypto few years back and people are still doing it, then found RBI didn't ban, they just requested people not to use it.

yinyang_in 6y ago
How will attack based on cryto will stop ban on crypto ?
- bobbydreamer 6y ago
  It's a currency that govts don't have control on or back track

jackfoxy 6y ago

Consider this: Every Satoshi can be traced back to when it was mined. The IRS now requires Americans and resident aliens filing income tax returns to report on their crypto holdings. Lots (maybe most?) people use exchanges like CoinBase. (Remember, not your keys, not your coins.) If the government believes (they do not even have to prove) your Satoshis were ever used for illicit transactions, they can legally seize those assets. (Sorry, we don't think you were involved, but these coins are criminals.) To simplify things they just need to show a judge reasonable cause of structuring sometime in the coin's history. That has to be super easy to do. https://www.goldinglawyers.com/structuring-cash-transactions https://www.goldinglawyers.com/structuring-cash-transactions

vmception 6y ago
Structuring doesn't apply to cryptocurrencies and there is no reporting threshold to be avoided yet. There are some proposals to make thresholds. Structuring currently only applies to physical cash passing a boarder or physical cash entering or exiting a financial institution. It does not apply to institution to institution transfers of any type and it doesn't apply to cryptocurrencies at the moment. I’ve had this discussion before, FinCEN is trying to change that. Because structuring is a criminal law, they would need to show a court a bit more to convict. But before a conviction they could make your life complicated with dumb rationale to a judge for a warrant or seizure notice, and that has nothing to do with cryptocurrency, everyone relies on the government and private persons not making their life complicated.
- jackfoxy 6y ago
  Yes. This would be new legal territory, but not radically new (IANAL). USG would certainly pick the case and the court to try it in carefully in order to establish the precedent.
  - vmception 6y ago
    Structuring regulations are very clear about physical cash in and out of a licensed financial institution (or avoiding declarations to customs). Most agencies and representatives have made it clear they aren't trying to debilitate bitcoin or bitcoin use. This fanfiction of the government not letting bitcoin be useful as a competitor is a weak argument mostly because the ship has sailed, about a decade ago.

divs1210 6y ago

Indian here. THIS is why India has been enslaved by foreign powers again and again. This is why Indians rarely innovate in India but outperform others abroad. Indian leadership SUCKS, and India will remain a third world shithole for the foreseeable future. I had some hopes from Modi, but now I don't. Not sure what kind of bad karma makes you reincarnate as an Indian, but my past lives must have been full of hedonism and debauchery. I hope.

eschulz 6y ago
I can't argue with you. However, I'm often unsettled when people envision such a gulf between them and the political leaders in their nation. I fear that this makes people say, "oh well, the government are idiots, but there's nothing I can do". I wish I knew the formula to improve state leadership, but I hope you never quit applying pressure to those in high office in India.
rakejake 6y ago
The real reason India is behind is because people like you and me are content dissing the country at every opportunity sitting in America.

teawrecks 6y ago

So basically, "We think it's time to steal the tech, ban any further innovation, and implement our own version that subverts the entire point of it to begin with"?

christiansakai 6y ago

Just wondering, I don't care much about cryptocurrency, but I do realize that we need cryptocurrency (as a side effect of blockchain) to make the blockchain secure (making it an incentive to run blockchain nodes). Assuming that indeed we as humanity need blockchain (and decentralization technology) in the future, can a blockchain or any other decentralization technology work without cryptocurrency (or any other incentive for that matter)? Any thoughts?

akhilkg 6y ago

I assume the thought process was something like this: Indian government looks at cryptocurrency and think "Ok so this is like UPI (digital money) - but I can't trace it and that's bad" - so boom - make an official cryptocurrency which they can trace back to and restrict all others. I don't know how good of a solution this is, but, defeats the point of crypto nonetheless.

deleted 6y ago
[deleted]

wtmt 6y ago

Firstly, consider that the Indian government believes every citizen and resident to be a crook and a tax evader unless proven otherwise. That’s why it has been pushing for “cashless” (even after the callous and disastrous demonetization exercise in 2016 that outlawed some currency bill denominations), linking taxpayers with a poorly designed and implemented non-revocable biometric based number (called Aadhaar), pushing for this flawed system to be used everywhere, etc. Next consider that the current regime has a charismatic leader who gets a lot of vociferous support for anything that can be spun into the “anti-terrorism” and “national security” angles. Since cryptocurrencies are only used by terrorists and tax evaders dealing in drugs and such (this is a sarcastic take here, but is believed so completely by the supporters of the government), they must be banned.

mythrwy 6y ago

If they pull both of these things off it may be bullish for precious metals. People will always want stores of value outside of monitored and adulterable (is that a word? hope the meaning is clear) centralized currencies. And the more trust is broken by the powers controlling the centralized currencies the more people will seek options to preserve and transfer wealth.

sub7 6y ago

They've already built BHIM and UPI. People think the government are a bunch of dumb babus but they're sharp as fuck and realized bitcoin is a virus and total lockdown early is best. If Indians want to go hold + transact cash in random BTC wallets then by all means they are welcome to do so illegally and subject themselves to scrutiny down the road.

option_greek 6y ago

Its quite clear why they want to do this at this point of time. The problem is the floating rate of USD/INR as seen by BTC/INR or any stable currency/INR is slipping like crazy since they started providing stimulus to economy last year. Its so bad, that there is a hair cut of around 8% regardless of the platform. This is only going to become worse as more money is going to be printed this year to get the economy back on track. No one can call out that the emperor is losing his clothes if they are terminated :)

azifali 6y ago

I think this is a needless and draconian proposal. If the government stops meddling with the constitutional rights of its citizen subjects, restore Right to Information (RTI), remove election fraud and fundraising which is tremendously boosting the currently elected government - they would have bestowed a huge favor to its citizens and the future generations.

specialist 6y ago

Has India banned other religions? Cue pearl clutching about slippery slopes.

jmsflknr 6y ago

Dupe: https://news.ycombinator.com/item?id=25968328 https://news.ycombinator.com/item?id=25968328

naruvimama 6y ago

To all Indian and non-Indians alike, a simple exercise will tell you a lot about the challenges the country faces from a security stand point. Enumerate all the countries around india,look at the political systems, demography, civil wars and genocide. India is a oasis in the region, to keep ot safe is a herculean task. And believe me you, until very recently the US and co often backed unsavoury elements animical to Indian interests due to political and strategic compulsions.

peter_d_sherman 6y ago

It will be highly interesting to see what happens here, and what the results are. Let's suppose, hypothetically, for the sake of reasoning about the future, that India passes this law. OK, so now India has an official, single, state-sponsored cryptocurrency, er, "digital currency". Well, India still needs the Internet to function to do that. If the Internet is still functioning, and we presume that it will be, then how are they going to block other cryptocurrencies, er, "digital currencies" from being transacted? Well, it could be China to the rescue! China's firewall "block out all other countries' Internet" technology that is! But if they use something like that, if they create a "walled Internet garden" in India, then what happens to Indian Citizens who travel abroad, and want to transact in India's digital currency? In fact, what happens if two people, who are not Indian, who are not located in India, want to create a transaction in the new Indian digital currency with one another? In other words, what are the rules of that game? What happens if you have two or more Indian Citizens, who have accounts with the new digital currency, who act as minature "bankers", (that is, to produce surety/insurance/act as a source of trust) who then underwrite contracts which can be paper or digital, where these contracts are detached from the system, and can be traded by any number of other people in any number of other countries? Make that practice illegal? You could -- but this is sort of how paper currency first became valuable -- because it could be used as a proxy for gold (the goldsmith being the party that brokers the trust). Also, it's sort of what commercial paper and stock markets and derivatives do... there's an underlying object of value, and then there's a piece of paper which grants some form of control to the underlying value, and a "trust broker" that guarantees that that relationship holds... Make that practice illegal and you've basically banned stock markets and commercial paper of all sorts. The banks and major financial players (who are well connected politically in whatever country we want to talk about) -- won't have that. So it'll be interesting to see how this plays out, if India can control it, or if, more than likely, "creative" people in the finance markets will find ways to game the system... Of course, the only other option is to let all of those uncontrollable digital currencies proliferate. I'd say that India, with respect to creating this digital currency, is "damned if they do, and damned if they don't"... In other words, there's no simple solution... But, on a positive note, 10+ years or so into the future, future historians and policy makers should be able to get a whole lot of information as to how this played out, what was negative, and what was possitive, the effects and ramifications...