Bitcoin at a $500 Premium in India as the Country Moves Towards Dictatorship – Trustnodes

Bitcoin at a $500 Premium in India as the Country Moves Towards Dictatorship


One bitcoin is selling at 817,400.00 Indian Rupees (INR), worth $11,700, on Bitbns, one of the few crypto exchanges in India where bitcoin can still be bought and sold.

On global exchanges bitcoin is at about $11,200 at the time of writing, making this a considerable premium probably because it is now very difficult to buy bitcoin in India.

“All the international transactions are blocked by my goverment to crypto,” says an Indian cryptonian before continuing:

“The local exchanges are barred from dealing with Local Fiat currency. My banks have sent me letters warning me to not buy crypto. Two of my bank accounts were shut down and the balance cheque sent to my home.

P2P system on some local websites have completly shut down as there are no sellers in sight as most people have shifted crypto in paper wallets, hardware wallets or overseas exchanges.

Goverment is continuously asking people to offload crypto or face jail. The economic advisor even said that buying crypto is counterfeiting foreign currency.

A bill has prepared to be presented and sealed on 7th of July to buy, hold or mine crypto as a criminal offence with Non-Bailable offence and 10 years jail term plus fines.”

He is presumably referring to Haleem Khan, a former secretary at the Ministry of Finance, who recently said there is a provision already for a 10-year prison sentence for counterfeiting currencies when asked of his views on a draft bill to make crypto holding illegal.

“I don’t find anything wrong with this approach,” Khan said, with concerns rising that India is moving towards outright dictatorship.

Reuters reports Reddit and Telegram was recently blocked in India. “In recent months, websites such as the discussion board Reddit, messaging service Telegram and comedy site College Humor have been blocked for intermittent periods, often for days and only in some regions,” they say.

It appears accessing a PayPal account is difficult too, with reports Citibank India has blocked PayPal payments.

Financial Oppression

India has apparently implemented capital controls as INR’s value against the dollar and other currencies keeps falling.

USD/INR price, June 2019
USD/INR price, June 2019

Interestingly they think high interest rates would prevent such fall in value, standing currently at 5.75% while inflation in India is at 3% with growth declining to 5.8%.

The value of a fiat money however tends to depend more on the level of government debt and the likelihood of it being repaid in addition to just how much demand there is for your money.

Demand that usually comes from selling goods and services to others which means they have to sell their fiat money and buy yours.

Looking at those factors, India has a 2.5% account deficit as it is importing more than exporting, and its debt of $1.2 trillion is increasing and very quickly.

High interest rates, on the other hand, increase both the likelihood the government won’t pay back the debt as well as increase the “real” supply of money. Both of those lower the value of fiat money.

Thus the problem is the government is spending too much and is redistributing too much wealth from the poor tax payer to the interest demanding bankers.

Yet they blame bitcoin for it because it allows smart people to maintain their wealth rather than see it fall in value.

That’s unfortunate because as a sort of “cheap” tech hub, bitcoin could have actually sent a lot of money to India where investors could have gone to build all sorts of projects.

The nationalists in India perhaps are not aware, but bitcoin moves in both directions, out of of India as well as into India if for example someone wanted to pay with bitcoin for freelance work.

Considering reports of very stringent capital controls, bitcoin may in fact be a convenient way for smart Indians to move money in and out.

That might however put a cap on just how much more the Indian government can spend than it receives in taxes, while also keeping the bankers in check for naturally they always want a higher and higher interest rate.

If people can instead exit with bitcoin, then they have to actually lure them back in by managing better their fiat money.

The government however wants more and more power, thus more and more spending. While bankers want more and more money, thus higher and higher interest rates.

Meaning instead of serving the people, they may be thinking in India of oppressing them. Certainly where it comes to financial matters, but also more widely, with an Indian freelance writer stating:

“Five years on, we have more than a glimpse of the ‘New India’ Narendra Modi has spawned. It is a reflection of its progenitor: culturally arid, intellectually vacant, emotionally bruised, vain, bitter, boastful, permanently aggrieved and implacably malevolent; a make-believe land full of fudge and fakery, where bigotry against religious minorities is among the therapeutic options available to members of a self-pitying majority frustrated by the prime minister’s failure to upgrade their economic standard of living.”

It’s a scathing critique of a generally very impoverished nation that lacks much education and now lacks financial freedom.


Comments (14)

  1. The write has no knowledge of Indian political institution and economics as a whole. Should refrain from writing.
    India is big nation with decentralised control which is based on state basis.

  2. So if India is a moving towards dictatorship than what’s North Korea is called? True democracy? Why won’t there ignorant writers eat some grass and get any knowledge. Useless fellow.

  3. what you all need is Bisq.

  4. Làst para is really interesting, and full of negative words. India towards dictator ship.. it seems writer is fully enjoying the freedom of speech and finally calling India is toward dictator ship wow..

  5. I believe the writer has sound knowledge of world affairs and a clear picture of the Indian financial system. For the clouded judgement of a Modi Bhakt, it is indeed very hard to see the truth of anything related to the deteriorating financial situation & breakdown of democracy when hate speech and criticism of Islam is not the prime topic of discussion. Read “the Creature from Jekyll Island” and educate yourself financially. It’s an excellent starting point towards better understanding world economics. Indian is a poor country and it’s citizens may have university education but they still have a poor mindset.

  6. Future of India/world is Bitcoin:

    1).India, blindly don’t ban Crypto. Just regulate them in +ve way & take crypto regulation policies from America, UK, Russia, Canada, Singapore, Egypt. 2).Punish money laundering offenders but, not Bitcoin. 3).Bitcoin was made for the world. Crores of Bitcoin block chain technology jobs were created. 4).”One world One currency” is achieved with Bitcoin. 5).India is getting lakhs of jobs in Bitcoin block chain technology. 6).Banning Bitcoin for money laundering reason is purely MAD decision… If so, “Ban all indian Roads/ vehicles because, so many accidents are occurring through roads/ vehicles”. 7).Bitcoin block chain technology is made and brought to us by God. 8).Now, 1Bitcoin value is $9,200, in near future 1Bitcoin value may go up to $1 million. 9).Worldwide e-commerse is possible through Bitcoin. 10).India will grow financially strong with Bitcoin. 11).If you try to ban or avoid Bitcoin block chain technology it means you are dragging India to 100 years backwards. 12).The world countries will shame on you.

  7. Writer has absolutely no knowledge of India. These handful of self declared intellectuals sit in there ac room may be in India or more probably outside India and then wake up having some fairy dream and then use there creativity and words learnt in premium schools just to vomit there conception.
    I am an Indian student. Have put all my savings in crypto but On your face I ell say… If indian government thinks it is must to ban crypto to stop Islam terror funding in India from foreign (basically Pakistan), I would happily loose all my crypto (my total savings on dump). And this is the spirit of at least 70% Indians.
    If I ell start counting what modi has given in just last 5 years… I ell need to write 1,000 posts like this viz. obviously times greater than what we people had got in earlier 60 year of other parties governance.

    Come out of your Ac room bro… Visit Jharkhand, Odisa, Bihar, Chattisgarh, and just don’t return from capital… But visit our villages also… Talk to just 100 villagers of any village and ask them what things you got in last 5 years and then what you had got in earlier 60 years

  8. Brilliant!!! Simple Facts put in perspective

  9. Crypto is the biggest scam in world history. It should be banned in all countries. Bravo India!

  10. Crypto is the biggest scam in world history. Should be banned in all countries.

  11. Why will anyone limit bitcoin capabilities?… The whole point is privacy. Glad my bitcoin investment on is outstanding.

  12. Well the Indian people can still use our p2p service on the OTC section and buy bitcoin, without worrying about crack down, don’t mention or write bitcoin during the transfer

  13. I generally respect trustnode articles. They are well researched. And even this article is very well researched as far as the financial points go. The writer is absolutely on the mark about almost every financial number and their significance.

    Where the writer falters is trying to paint some ‘freelance writer’ as an expert who knows what is happening in India. This writer claims that Modi has anti-Muslim policies. However, surveys show that at least 10% of Muslims voted for Modi/BJP in the recent elections, even though the opposition parties have clearly painted them as anti-Muslim. 10% of Indian muslim voters is a huge numbers. Its more than the total population of Scotland. Its more than the number of Palestinians who voted for Hamas or any other single Palestinian political party.

    Just because Modi is called a ‘nationalist’ and sometimes ‘hindu nationalist’ does not make him the next Fuhrer. These are just labels. How can the word ‘nationalist’ be a dirty word? The main opposition party to Modi is INC, and its name contains the word ‘national’. So is it now a dirty nationalist party?

    The writer is obviously just going by labels. That’s very misleading.

    Not just the labels, the writer is totally unaware of the actual situation. For example he says;

    > The nationalists in India perhaps are not aware, but bitcoin moves in both directions, out of of India as well as into India if for example someone wanted to pay with bitcoin for freelance work.

    He seems unaware that the ‘ban’ on bitcoin as formulated by RBI is done as a totally apolitical decision. The government can’t tell RBI to ban bitcoin. Just as the Fed is independent of US government, the same is true of Indian banking system.

    He is also unaware of the needs of India:

    > The government however wants more and more power, thus more and more spending.

    Unaware that only 2-4% of Indians pay taxes. now if the government wants to improve tax collection at such a low base, how is that wrong? India is poor because the government is powerless. Powerful people like local criminals and underworld gangs torment the public, rich fatcats like Vijay Mallya have been gaming the system for decades, all because of a very weak government. The government represents the will of the poor people of India, and as such is their best bet against injustice.

    I could write more. But I don’t want to keep beating the same old drum.

  14. India is the most shittest country I have come across. The whole system is corrupt and they can never progress.

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