The world of online betting in India is likely to face a blow soon, as India plans to ban on cryptocurrency like Bitcoin in India. A new bill with the title “Cryptocurrency and Regulation of Official Digital Currency Bill 2021” is all set for the introduction, consideration and passing in the parliament of India this year. Among all the cryptocurrencies, also known as digital currency, Bitcoin is the most popular one. These digital currencies are based on blockchain technology, and they are purely digital or virtual.
A few countries like India don’t pretty much accept the Bitcoin as a currency, as the Bitcoin are neither made of metal or exist in physical form, nor were they stamped by any regulatory body or governments. The government basically has no control over how the currency is used for the transactions. It’s not the first time India is mulling to ban Bitcoin and all other cryptocurrencies.
In the year 2018 too, the Indian government tried to ban private cryptocurrencies, and replace them with a digital version of the fiat currency to “safeguard” the country’s financial system. That time, the proposal was challenged by a few, and the lawsuit was filed in the Supreme Court, which ruled in their favour last year. However, given the majority of the ruling party in both the houses, the odds are very much in favour of passing the bill this time. There are strong reasons and motive for them to do so, with close to 2 million Indian people trading in digital currencies.
The intention is to contain illegal activities like money laundering and terror financing
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Apparently, the intention is to contain illegal activities like money laundering and terror financing that worked out through cryptic transactions using the Bitcoin. China has already imposed various restrictions on the usage of cryptocurrencies. In India too, the legislation is needed for its regulation, provisioning for consumer protection and concerns about its usage in illegal activities.
Any ban of cryptocurrency in India would mean a ban on dealing in Bitcoin in India for activities like online betting. Bitcoin isn’t just used to buy goods or services. They are used heavily for online betting and gambling in India, and across the world. You must be wondering how, given the fact that betting and gambling is banned in India. Well, yes Betting or gambling is still illegal in India, however, online betting isn’t, as the Internet has no boundaries. There are many websites tied-up with offshore betting and gambling agencies, thus allowing one to place online bets in India legally.
India Premier League (IPL) – the world’s largest and richest T20 fun88 league – is the hot event for online betting in India, and the world for that matter, though there are various other sports on which people bet online in India. Also, a new trend is seen nowadays, which is betting on virtual games. The footfall for fun88 and various other games through mobile applications have risen, especially during the lockdown amid the pandemic. With evolving technology and higher internet speed, online gaming with friends virtually connected has become a fad. Online betting, a branch of betting and gambling, on various sports and virtual games has grown enormously in India recently.
While bitcoin and other cryptocurrencies gained popularity over time, they boosted new methods of online gambling and betting due to its digital nature. Bitcoin, a parallel to the existing traditional currency, is quite easy in crossing the borders when it comes to payments, as money could be instantly transferred to anyone, anytime across the globe in a decentralized fashion. Also, when used for betting transactions, one prefers anonymity over everything else. That’s exactly where ‘un-traceability’ of the Bitcoin is a perfect fit. And hence, one can participate in betting activities on a larger scale, betting on sports, across the countries. This is the reason for its increased popularity in the betting arena.
Recently, on 11 December, an online betting racket of INR 1000 crore was unearthed in India which involved cryptocurrency trading over multiple currency exchanges. If the new law to ban the Bitcoin makes its way, it would definitely weigh on the cryptocurrency ecosystem in India. The law would lead to tight security checks, control and inspections on all sorts of betting, with or without Bitcoin. The betters who relied heavily on the digital currencies like Bitcoin may have to find another way to place their bets, like dealing in fiat currencies or placing bets outside India. In all likelihood, a dip in the number of betters is expected if the law passes. And accordingly, the betting amount would as well plunge to a great extent until gamblers find the substitute ways to do the online betting.
Regardless of the bans or regulation issues in some countries, gambling using Bitcoin continues to rise each year. The use of the digital currency to play classic casino games such as blackjack, roulette, dice might continue to surge. Same it is for the online betting on sports and virtual games. Of course, if stricter regulation is enforced in India, the people may not be able to participate in online gambling or betting using Bitcoin or any other cryptocurrencies, but the fiat currencies can still be used.
Let’s see the example of China, the neighbouring country, also the most populous county in the world. When China had imposed a ban on Initial Coin Offerings (ICO), a cryptocurrency-based fundraising process, in September 2017, the Bitcoin prices declined by 6% immediately. We may see a similar or slightly lower dip if India ban goes through. Also, Bitcoin exchange was forced to close its Chinese trading operations. Similar repercussions could be seen in India as well.
So, not just online betting, the restrictions will impact all the investors and traders who deal in Bitcoin. The gambling, lotteries, trading, online betting in India will be adversely impacted. The investors might lose the money and eventually operate out of India if they want to continue dealing in the Bitcoin or any other cryptocurrencies. As for any financial system that wants all the possible modes of transactions to thrive, the online betting might feel the heat if the crypto is banned in the largest democracy in the world.
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