Some countries are banning cryptocurrency, others are making it part of their economies. In this segment of “The Crypto Show” on Motley Fool Live, recorded on Feb. 2, Fool contributors Jon Quast, Chris MacDonald, and Travis Hoium chat about the cryptocurrency path that India is taking.
Jon Quast: India’s finance minister proposing a tax on transferring digital assets. It seems like this would include cryptocurrencies and NFTs, the way that it’s worded. A 30% tax, which is pretty hefty. Also announcing a digital rupee in the works for either this year or next year.
Now, this is some interesting stats regarding India, obviously the world’s most populous nation. There are more cryptocurrency users in India than any other country in the world. That’s not terribly surprising given it’s such a large population.
What is surprising to me is that in terms of the percentage of cryptocurrency adopters, India is actually fifth in the world with 7.3% behind the Ukraine, Russia, Kenya, I was shocked to see Kenya as No. 3 and then the U.S. This is big news. I don’t know if this hurts or helps cryptocurrency adoption in India. What do you guys think?
Chris MacDonald: My take on this is, it seems like where in regions of the world where crypto is looking to be regulated. There’s really two avenues that regulators are looking at. One is banning it outright and the other is taxing it and incorporating it into the economic system of the country.
When India announced this, oddly enough, you’d think a 30% tax and a central bank digital currency might be negative news for the market, but the market actually jumped on this because this was a pivot. The country had initially talked about banning it and I know we’re going to talk about Russia in a bit. This is a similar line of reasoning that investors are looking at this and saying, regulation, maybe it’s a good thing in the sense that regulatory bans might be off the table and the government is looking to integrate crypto into the economy rather than maybe over-regulated, or regulated out.
Some of the statistics there about the countries where you’re seeing massive adoption. That is interesting, seeing Kenya there, but I would have imagined some South American countries or countries with currency issues might have been on that list, but I’d like to see the longer list actually to look at that.
Travis Hoium: It’ll be interesting to see some of these countries looking at this as a differentiator for them as well. If you can be an early adopter in cryptocurrencies, one of the things that’s interesting as I dive into some of these spaces you see in Discords or Twitter ( TWTR -3.16% ), people from all over the world and I’m not surprised to see Ukraine and India toward the top there because you see people from those countries popping up all the time, whether it’s coming from the art scene or developers of projects. They could be seeing this as a way to boost their economy just in a digital sense.
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