India Intends To Legislate To Ban Cryptocurrency, And Individuals Will Be Punished For “Mining” And Holding

A senior official said that the country is planning to ban cryptocurrency and punished anyone even holding such digital assets transactions in the country, which could hit the influx of millions of Indian investors in this hot sector.

The official stated that the new legislation is one of the most stringent laws against cryptocurrencies in the world, and will criminalize the possession, issuance, mining, trading, and transfer of cryptocurrencies. 

However, in order to appease cryptocurrency investors, even if the bill is passed, it will give everyone a maximum of six months to liquidate, before violators will be punished. The government of Indian Prime Minister Narendra Modi (Narendra Modi) has a majority of seats in the parliament, so the bill is likely to be passed.

According to industry estimates, 8 million Indian investors now hold 100 billion rupees (about 1.4 billion U.S. dollars) worth of cryptocurrency.

However, the above-mentioned officials refused to disclose whether the new bill includes imprisonment and fines, and refused to provide more details, but said that the discussion has entered the final stage. 

The currency market is feverish again. After breaking through US$59,000 on the evening of March 13 and setting a new all-time high, Bitcoin once again rose to US$60,000, and it was on the hot search on March 14, and the market was talking a lot. In addition to Bitcoin holders, revelers, the “mining circle” of the Bitcoin upstream industry is also in a state of extreme fanaticism. New mining machines were sold out, second mobile phones were also robbed in seconds, and the mining industry was unprecedentedly hot due to the skyrocketing Bitcoin. However, in the view of industry insiders, under policy risks, it is still necessary to take a calm look at the mining business. In the future, we must guard against multiple risks such as falling currency prices, reduced mining revenues, and excessively high Bitcoin purchase costs.

96,700 people Were blood Bathed

The price of Bitcoin is skyrocketing again. Starting at 18:00 on March 13, the price of Bitcoin saw a short-term rise. After breaking through the $59,000 mark, it stood at $60,000 at 20:00 that day. After a short correction, it rose again at 4 a.m. on March 14 To the highest price of 61,750 US dollars (about 400,000 yuan), as of 17:00 on March 14th, the latest Bitcoin price was 60,716 US dollars (about 395,000 yuan), up 6.16% in the last 24 hours, and the turnover was 208.485 billion yuan. , The market value is about 7.37 trillion yuan.

The price of Bitcoin surpassed 60,000 U.S. dollars. For a time, the entire currency circle was boiling. Some holders liked to report in the circle of friends and began to predict the next high. Many people who eat melons bluntly did not understand and questioned “nothing.” Why can value-supported games become so crazy?”

“This round of Bitcoin bull market is a product of high inflation expectations.” A senior analyst analyzed that when U.S. bond yields rose rapidly some time ago, the market believed that the Fed’s monetary policy would change faster than expected, predicting the Fed The purchase of bonds will be reduced in advance, and even the time for raising interest rates is likely to advance. In this context, both the stock market and Bitcoin have plummeted. The recent rises in US stocks and Bitcoin are due to the fact that the market has stepped out of the previous haze, and the market’s expectations for mid-to long-term inflation have risen.

However, despite the rise in the price of Bitcoin, investors still need to be highly alert to the risk of subsequent volatility. In Su Xiaorui’s view, on the one hand, Bitcoin prices frequently show a “roller coaster” state, which can easily lead to liquidation; on the other hand, they also face policy risks. Some officials in the United States have repeatedly pointed out that such cryptocurrencies are speculation. Sexual assets also involve money laundering risks.

The price of Bitcoin frequently rides on the “roller coaster”, which is obvious to all in the industry. In fact, in January 2021, driven by the increase in purchases by large institutional investors and the enthusiasm of retail investors for participation, the price of Bitcoin has repeatedly hit record highs. However, in just one day, Bitcoin began to experience a sharp drop, with an intraday drop as high as 19%; In addition, on March 12, the price of Bitcoin rose all the way, breaking through the $58,000 mark in the short-term, but the price of Bitcoin suddenly crashed that night, falling more than $3,000 within two hours.

The Mining Market Is Crazy

As we all know, Bitcoin is not issued by a specific institution, but is generated through a large number of calculations based on a specific algorithm, which is the so-called “mining”. Specifically, according to the Bitcoin POW (Proof of Work) mechanism, each computer Node uses their computing power (also known as “computing power”) to grab the right to bookkeeping. Whoever grabs the right to bookkeeping can get the corresponding bitcoin rewards generated by the system. Among them, the hardware equipment for mining is called “mining machine”, the individual miner who purchases the mining machine is called “miner”, the place that hosts the mining machine and provides electricity is called “mine”, and there is also a mining platform “mining machine”. Pool” and so on.

The rise in the price of Bitcoin has directly promoted the surge in demand in the mining machine market, and many investors have purchased more high-power mining machines. An industry insider Zhang Li (a pseudonym) said that at present, Shenzhen Huaqiangbei has become one of the largest mining machine sales and distribution centers in the country and even in the world. Many companies in an office building are engaged in the mining machine business, and graphics cards are completely out of stock. Zhang Li also told a reporter from Beijing Business Daily that the price of Bitcoin has risen sharply and the mining machine market is in short supply. This frenzy has been going on for a long time, and even the notebooks have been sold out and used for mining.

In addition to the new machines sold out, the current second-hand mining machine market is also booming. On March 14, a person who claimed to be “Shenzhen Huaqiangbei long-term recycling of second-hand mining machines” promoted in the circle of friends and major platforms, “A large number of Shenma m20, m21; a large number of s17, t17, s19; a large number of various bits Coin machine…” It is understood that even second-hand mining machines are in a frenetic state of being snatched in seconds.

Regarding the mining machine market, a Blockchain Research Institute introduced that from 2018 to 2019, there was a Bitcoin bear market. Except for individual investment companies, few companies entered the mining industry. But since 2020, companies in the IT industry (such as online games, information security, etc.) have begun mining. Relevant data shows that as of February 20, 2021, 40 companies around the world, including overseas mining stocks, have owned more than 1.31 million bitcoins, which is more than 6% of the total number of bitcoins of 21 million, and the value exceeds 730. One hundred million U.S. dollars.

Hidden Dangers Behind

Behind the continuous breakthrough of Bitcoin’s new highs, it is still necessary to note that under the extreme mania of the mining market, its risks are full of hidden dangers.

“Overall, Bitcoin prices continue to rise and break new highs, which will increase the market’s enthusiasm and demand for mining machines, which in turn will have a direct impact on the mining business.” However, Su Xiaorui also pointed out that combined with the recent clearing of mining in some areas From the perspective of the mining business, the current mining market is too hot and there will be policy risks, including both domestic and foreign policy risks.

On the one hand, there is policy risk. Because of the “high energy consumption” issue, after the National Development and Reform Commission in April 2019 included insurance as an “industry that has been explicitly eliminated or immediately eliminated by the national industrial policy”, the Inner Mongolia Autonomous Region Development and Reform Commission issued another announcement at the end of February 2021 “Several safeguard measures to ensure the completion of the “14th Five-Year” energy consumption dual control target task (draft for comments)”, plans to comprehensively clean up and shut down virtual currency mining projects, all exit before the end of April, and new virtual currency mining projects are strictly prohibited.

On the other hand, there is a price risk. The current surge in Bitcoin has pushed up the price of mining machines. According to industry insiders, the sales of mining machines are driven by the soaring of virtual currencies such as Bitcoin, but if the prices of the latter fall sharply, the mining machine market will undoubtedly be greatly affected. At the end of January 2021, the price of Bitcoin suddenly “dipped” after climbing to a high level, and many second-hand mining machines were sold at discounted prices.

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