The vulnerabilities in India’s digital currency strategy might be advantageous for nations seeking to expand their crypto networks.
Several Indian cryptocurrency exchanges now want to relocate from India to the United Arab Emirates, signalling that the UAE could be on the verge of becoming the world’s new crypto powerhouse.
Nischal Shetty and Siddharth Menon, the founders of one of the major Indian cryptocurrency exchanges WazirX (WRX), recently relocated to Dubai. This sparked rumours that more crypto and Web3 startups would move overseas.
This theory seems to be playing out as expected. Most recently, a large family office Eros Investments, run by India’s Lulla family, said it will develop its Web 3.0 and blockchain empire out of Dubai’s World Trade Center Authority (DWTCA). The Lulla family has deep ties to the country having found the film and media company, Eros.
As it turns out, India-based cryptocurrency exchanges want to capitalise on the upbeat climate offered by pro-cryptocurrency governments, such as the government of Dubai. This is in stark contrast to India’s unfavourable crypto environment due to its leadership issues.
India’s anti-cryptocurrency position is the main source of discontent among crypto-market participants. In addition, the Reserve Bank of India (RBI) has maintained a critical stance on cryptocurrencies.
Moreover, the latest tax regime, which imposes a flat 30% tax on all crypto earnings, does no investors or crypto service providers a favour. Amid this chaos, Dubai seems to give crypto service companies a glimmer of optimism.
Is India losing out on the cryptocurrency revolution?
As witnessed in the late 1990s, India has been rather conservative in adopting new trends and technologies. Even though the Internet was introduced in August 1995, it took India more than a decade to adopt the technology. Is India now repeating a pattern?
Currently, India is one of the leading countries in blockchain innovation. It has garnered breakthroughs with Polygon (MATIC) and WazirX (WRX), demonstrating that its people are vying for a spot in the global blockchain ecosystem.
However, the leadership is still in a deep slumber and is oblivious to the evolving nature of technology and the role it may play in the growth of the world’s fastest-growing economy.
From the Reserve Bank of India’s (RBI) prohibition on cryptocurrency trading in 2018 through the Supreme Court’s overturning of this ruling two years later, and now the recently implemented 30% tax on digital assets, India’s position on cryptocurrencies has been very unfavourable.
India may have lost out on the dot-com boom, but the nation now has more talent and a fair playing field. India is, without a doubt, capable of producing the next Google or Amazon in the blockchain space, given the proper direction and incubation.
What’s ahead for India amid the ongoing blockchain revolution?
Regional markets in India are likely to embrace cryptocurrencies, and the present trend indicates that more Indians of all demographics will join the cryptocurrency revolution.
Meanwhile, India is likely to lose out on billions of dollars and a robust economic trajectory due to its restrictive environment. It’s time for India’s leadership to take a stand and concentrate on creating a favourable environment for blockchain and cryptocurrencies rather than wavering and subsequently mourning their decision.
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