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Facebook’s new cryptocurrency, Libra, might not be available in India because of the current ban on all blockchain-based cryptocurrency transactions. A report by a local publication, The Economic Times, cites people familiar with the matter claiming that Facebook has yet to apply for Reserve Bank of India’s approval to launch Libra in India.
Furthermore, a Facebook spokesperson has underlined that Libra will not be available in US-sanctioned countries or countries that have a ban on cryptocurrencies, which means Facebook will be missing out on some of its largest markets including India. The Economic Times did not receive a comment from the Reserve Bank of India.
The RBI might not be concerned about Facebook’s Libra if the project was operating in a closed peer-to-peer (P2P) system. However, if the digital currency was able to interact with the external economy, the RBI will want to intervene. In its April 6 circular, RBI said that “entities regulated by the Reserve Bank shall not deal in VCs [virtual currencies] or provide services for facilitating any person or entity in dealing with or settling VCs.”
Regulators from Across the World Against Facebook’s Crypto Project
Facebook recently revealed the whitepaper for its ambitious cryptocurrency and blockchain project, Libra. However, Facebook does not have a great track record when it comes to data gathering and spying on its users. Which is why, across the world, legislators raised concerns regarding the implications of Facebook Libra running wild without the necessary checks and balances.
Countries like France, Germany, England, the U.S., and even Russia have called for an immediate overview or outright ban of Facebook’s stablecoin. Facebook had been rumored to test launch Libra on WhatsApp in the Indian market, targeting the remittances and micro-transactions market. However, with the RBI banning all cryptocurrencies, Facebook might not get a chance to do that.
While it is true that Facebook faces an uphill battle, regulators fear that with the power of many gigantic corporations behind Libra, it may be only a matter of time until Facebook is able to bypass legislation through political lobbying and influence. The only realistic way to tame this social media-crypto beast is to act early and decisively.
The Indian government is also considering banning all cryptocurrencies and even a ten-year prison sentence is on the table for citizens who trade crypto. Which means that even if Facebook does want to launch Libra in India, it might have to bend to the RBI’s will.