Panic selling on major crypto exchange WazirX resulted in a significant price decrease on popular cryptocurrencies such as Bitcoin (BTC) and Ether (ETH), as regulatory discussions in India surrounding a crypto ban sparked panic selling (ETH).
Crypto prices in India plummeted after the Indian parliament announced that it would introduce and list 26 new bills during the Winter Session, one of which was the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, which included the Cryptocurrency and Regulation of Official Digital Currency Bill. The bill, as previously reported, seeks a parliamentary vote on creating an official digital currency while prohibiting “all private cryptocurrencies” beginning Nov. 29.
A massive sell-off on WazirX at 3:30 a.m. UTC on November 24 slashed the price of Bitcoin from over Rs. 4,600,000 ($61,820.73) to Rs. 3,917,659 ($52,650.55), a decline of –14.8% in only two hours. Other prominent coins, including as Ether and Cardano (ADA), had double-digit price drops on the market as well.
Prices have reached worldwide levels as a result of this panic selling episode
According to WazirX CEO Nischal Shetty, the Indian crypto market trades at a premium to the global market:
“The Indian market has corrected and prices have reached worldwide levels as a result of this panic selling episode.”
Shetty also discussed the many uses of cryptocurrencies as an asset or service, citing former Indian Finance Minister Subhash Chandra Garg’s remark that “there should be a limitation on the ‘currency’ use case of crypto,” if any.
The necessity for a sophisticated approach to regulating crypto assets in India was discussed by Jay Hao, CEO of cryptocurrency exchange OKEx:
“India has the biggest number of cryptocurrency owners in the world. And it is the government’s responsibility to defend the interests of a significant number of cryptocurrency investors in the nation.”
“This prohibition would not work in the long-term. And would be a step backwards,” BTC Markets CEO Caroline Bowler said of India’s crypto ban. She added that “banning is not an option to safeguard investor interest”. According to Bowler:
“The issue about cryptocurrencies is that, while governments may try to restrict it or contain it, the technology’s decentralised structure prevents this.”
“Let’s not panic”
Shetty says that Indian entrepreneurs should have trust in our parliamentarians as a final piece of advice. He said, “Let’s not panic”.
This follows a legislative panel session on cryptocurrencies on Nov. 15, in which a majority of regulators agreed that, while crypto cannot be halted, it should be strictly controlled.
The Reserve Bank of India said in August that exploratory testing for a central bank digital currency will begin before the end of 2021, according to a spokesperson. With more than 20 million crypto investors, India is now one of the world’s largest marketplaces.