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Key conclusion: > All these factors lead to the conclusion that banning cryptocurrency is perhaps the most advisable choice open to India. And so they may, fo

Key conclusion: > All these factors lead to the conclusion that banning cryptocurrency is perhaps the most advisable choice open to India. And so they may, for probably 4th or 5th time. Cryptocurrency on- and off-ramps can be somewhat controlled, but overall it's a pretty difficult thing to ban in practice.

captn3m0 5y ago
The average investment (as per RBI) in crypto assets is 3000 INR or so, the vast majority of which is via crypto exchanges. The earlier bans were indirect (RBI asking Banks asking Payment processors to close down exchange ramps) and didn't stand up to legal scrutiny. A direct ban via legislation ought to work in practice. Exchanges (and other companies offering crypto in India) have already de-risked against this by getting registered in Singapore. A ban doesn't have to work perfectly, it just has to dissuade enough users.
- Proven 5y ago
- sundarurfriend 5y ago
  > A direct ban via legislation ought to work in practice. > A ban doesn't have to work perfectly, it just has to dissuade enough users. That much it can probably accomplish, especially given the current level of censorship of the Internet.
retube 5y ago
> but overall it's a pretty difficult thing to ban in practice. That applies to just about everything. We have laws against tax evasion, fraud, murder... but people can (and do) still do these things. Just because a law doesn't or can't physically stop people doing things doesn't mean we shouldn't have the law. The point is, if it is banned then you will severely constraint the ecosystem. On-off ramps and other intermediators will have to shut down, institutional participants will be forced to withdraw etc etc. Sure no doubt a handful of participants will flaunt the rules and continue to participate, trying to keep the dream alive, but for all practical purposes it'll be dead in the water.
- tiborsaas 5y ago
  You can also ban drugs or even alcohol, both are a stellar success stories. Crypto isn't likely to go away and the whole situation resembles to a global prisoners dilemma, I think the best governments could do is to come up with a sensible regulation.
  - rrdharan 5y ago
    Drugs and alcohol are fun (and/or they have inherent value). Crypto is only fun when it’s arbitrarily going up in value, which would seem to be somewhat curtailed but these bans. Of course crypto can be used to obtain (illegal) drugs, but it’s not clear that “sorta hard way to sometimes buy certain kinds of also illegal things” is as inherently valuable..
    - eric_cc 5y ago
      > Crypto is only fun when it’s arbitrarily going up in value If you treat it like a casino then that is true. Ideally, it takes over fiat currencies altogether and takes away the government’s ability to Arbitrarily create money out of thin air whenever it benefits them.
      - rrdharan 5y ago
        That may be your ideal but it is most definitely not mine. I don’t understand how people can compare the austerity debacle and resulting outcomes in Greece with what the US was able to do (and turn a profit on) post financial crisis and decide that somehow the Greek way was better, countries shouldn’t be able to use monetary countermeasures, and these constraints will magically produce better politicians who will get it all right, because otherwise it would go wrong. We’ll still get the incompetence, it will still go wrong, and the results are just worse all around. Crypto fans obsessed with the handling of the financial crisis should brush up on the concept of Panglossian optimism. https://en.wikipedia.org/wiki/Greek_government-debt_crisis https://en.wikipedia.org/wiki/Greek_government-debt_crisis
    - tiborsaas 5y ago
tiku 5y ago
You can only ban fiat going in or out "easy", once you have some BTC you can just do your thing.
- fullstop 5y ago
  Sort of, but you'll run out of BTC after some period of time. The transaction fee ends up in the hands of the miners.
- dmos62 5y ago
  Well not yet you can't, as far as I can tell. I'm not sure what I'd do if I had to pay for everyday things in crypto.
deadmercury 5y ago
Did you jump straight to conclusion? Argument of banning is discussed in points 33-36.
moonchrome 5y ago
Nobody would care about crypto if there was no institutional activity in it.

captn3m0 5y ago

The average investment (as per RBI) in crypto assets is 3000 INR or so, the vast majority of which is via crypto exchanges. The earlier bans were indirect (RBI asking Banks asking Payment processors to close down exchange ramps) and didn't stand up to legal scrutiny. A direct ban via legislation ought to work in practice. Exchanges (and other companies offering crypto in India) have already de-risked against this by getting registered in Singapore. A ban doesn't have to work perfectly, it just has to dissuade enough users.

Proven 5y ago
sundarurfriend 5y ago
> A direct ban via legislation ought to work in practice. > A ban doesn't have to work perfectly, it just has to dissuade enough users. That much it can probably accomplish, especially given the current level of censorship of the Internet.

retube 5y ago

> but overall it's a pretty difficult thing to ban in practice. That applies to just about everything. We have laws against tax evasion, fraud, murder... but people can (and do) still do these things. Just because a law doesn't or can't physically stop people doing things doesn't mean we shouldn't have the law. The point is, if it is banned then you will severely constraint the ecosystem. On-off ramps and other intermediators will have to shut down, institutional participants will be forced to withdraw etc etc. Sure no doubt a handful of participants will flaunt the rules and continue to participate, trying to keep the dream alive, but for all practical purposes it'll be dead in the water.

tiborsaas 5y ago
You can also ban drugs or even alcohol, both are a stellar success stories. Crypto isn't likely to go away and the whole situation resembles to a global prisoners dilemma, I think the best governments could do is to come up with a sensible regulation.
- rrdharan 5y ago
  Drugs and alcohol are fun (and/or they have inherent value). Crypto is only fun when it’s arbitrarily going up in value, which would seem to be somewhat curtailed but these bans. Of course crypto can be used to obtain (illegal) drugs, but it’s not clear that “sorta hard way to sometimes buy certain kinds of also illegal things” is as inherently valuable..
  - eric_cc 5y ago
    > Crypto is only fun when it’s arbitrarily going up in value If you treat it like a casino then that is true. Ideally, it takes over fiat currencies altogether and takes away the government’s ability to Arbitrarily create money out of thin air whenever it benefits them.
    - rrdharan 5y ago
      That may be your ideal but it is most definitely not mine. I don’t understand how people can compare the austerity debacle and resulting outcomes in Greece with what the US was able to do (and turn a profit on) post financial crisis and decide that somehow the Greek way was better, countries shouldn’t be able to use monetary countermeasures, and these constraints will magically produce better politicians who will get it all right, because otherwise it would go wrong. We’ll still get the incompetence, it will still go wrong, and the results are just worse all around. Crypto fans obsessed with the handling of the financial crisis should brush up on the concept of Panglossian optimism. https://en.wikipedia.org/wiki/Greek_government-debt_crisis https://en.wikipedia.org/wiki/Greek_government-debt_crisis
  - tiborsaas 5y ago

tiku 5y ago

You can only ban fiat going in or out "easy", once you have some BTC you can just do your thing.

fullstop 5y ago
Sort of, but you'll run out of BTC after some period of time. The transaction fee ends up in the hands of the miners.
dmos62 5y ago
Well not yet you can't, as far as I can tell. I'm not sure what I'd do if I had to pay for everyday things in crypto.

deadmercury 5y ago

Did you jump straight to conclusion? Argument of banning is discussed in points 33-36.

moonchrome 5y ago

Nobody would care about crypto if there was no institutional activity in it.