“Don't panic sell” was the unified advice and request most Indian crypto trading exchange founders gave after witnessing Wednesday's crash that followed the government's move to introduce legislation to ban most private cryptocurrencies.
Discussions around the possibility of a cryptocurrency ban crops up in India every few months. The topic resurfaced late Tuesday following the Indian government's decision to introduce The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, for discussion in the winter session of the parliament that begins on Nov. 29.
The speculation of a blanket ban on private cryptocurrency led to heavy sell-off on crypto trading exchanges inclding Binance-owned WazirX. The prices of all major cryptocurrencies dropped by almost 10-15% overnight in India.
WazirX co-founder Nischal Shetty took to Twitter to reassure the investors. "This is not the end but the beginning of crypto regulations in India."
“This is a big moment for India,” Shetty told International Business Times.
“From a banking ban in 2018 to listing the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 in Parliament's winter session, our nation has come a long way in these three years! It speaks volumes about how India is determined to dominate the web 3.0 era,” said Shetty.
The bill has caused quite a stir among crypto enthusiasts in the country. It was first listed for the budget session in January, but the Indian government deferred the bill and sought a "public consultation."
"While the description of the draft bill appears to be the same as in January 2021, several noteworthy events have occurred since January. First, the Parliamentary Standing Committee invited a public consultation, and then the Prime Minister himself came forward to call for crypto regulations in India," Shetty said.
WazirX app briefly crashed from heavy user activity.
WazirX's exchange had crossed the 10 million mark earlier this year, with a lot of investor inflow in the past six to eight months.
Estimates indicate there are 15 million to 20 million crypto investors in India, with total crypto holdings of around $5.39 billion (or Rs 40,000 crore), according to Moneycontrol.
Ashish Singhal, founder and CEO of CoinSwitch, also put out a tweet urging people to remain calm, and stated that the Indian government seems to have a "progressive approach" based on recent conversations.
Zerodha founder Nikhil Kamath encouraged users to share their thoughts on what would happen to crypto in circulation if the government does go through with the ban.