Tim Draper sounds off on India’s crypto situation

• The Inter-Ministerial Committee (IMC) report proposes jail time for crypto mining, holding or transacting.  
• Tim Draper criticized the Modi government, calling it backward.

Indian blockchain advocate Varun Sethi had leaked the draft Banning of Cryptocurrency & Regulation of Official Digital Currency Bill 2019. Soon after this, the government of India made the report public. The Inter-Ministerial Committee (IMC), that’s led by Subhash Chandra Garg, released the report.  

There have been significant counter-arguments for the ban from the Indian cryptosystem. Timothy Draper, a venture capitalist and founding partner of Draper Fisher Jurvetson (DFJ), Draper Associates, and the founder of Draper Venture Network and Draper University spoke a few words about the same. In an interaction with Inc42, Draper said:

“It is akin to the Luddites. They are in fact saying, ‘we will not tolerate progress.’ It will set them back 40 years. Imagine if they did this with the internet?”.

In addition to imposing a complete ban of cryptocurrencies, the IMC report also proposes a jail term of 1-10 years for anyone involved in mining, holding, dealing or transacting with cryptocurrencies in any form – directly or indirectly. The draft also proposes a penalty of up to INR 50 Cr (~$7.25 million). Draper criticizing the move said:

“People will want to leave India to get to a country that is less backward. I suspect they will get out so they can live a better life.”

Back in 2017, the Dinesh Sharma Committee report had suggested a complete ban and proposed that warnings must be issued to the effect that cryptocurrencies are neither coins nor currencies, urging users to not trade in them. Another committee was reconstituted by the ministry of finance in November 2017 to come up with a draft crypto regulatory framework. The report released this month and the attached draft bill failed to consider cryptocurrencies as either a currency or an asset. Draper said:

“It seems as though they are clinging to their power instead of thinking of the good of the country. This move shows that Modi has not yet rooted out corruption in the country. It lives on in his own government.”  

BTC/USD daily chart

After consolidating in a flag formation, BTC/USD finally had a bullish breakout this Saturday. The price went up from $9,855 to $10,135, facing immediate resistance from the 50-day simple moving average (SMA 50) and SMA 20 curves. The relative strength index (RSI) indicator is trending around the neutral zone.