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American fintech firm Ripple has proposed a policy framework for cryptocurrency regulation in India amid local crypto uncertainty.
In an effort to persuade Indian authorities to support fintech regulation and the growing cryptocurrency industry, Ripple has issued a policy document addressed to local lawmakers.
India as the dominant use case for cross-border payments and remittances
Released on June 18, Ripple’s policy paper provides a set of recommendations for Indian policymakers, offering an overview of the global digital asset landscape and steps to adopt a new digital currency policy in the country.
Entitled “The Path Forward for Digital Assets Adoption in India”, the 36-page document promotes XRP and calls on India to provide regulatory clarity for cryptocurrencies.
In the policy document, Ripple specifically outlines XRP’s potential to become a key solution for cross-border payments in India, which is considered the “dominant use case for cross-border payments and remittances”.
Noting that existing methods of cross-border transactions can take four to eight days, Ripple says it can handle a transaction from an Uzbek bank to its Indian counterpart “near real time,” adding:
“This path minimizes the costs, time and risks that prevailing cross-border banking models retain. As a corollary, many points of friction such as minimum account balances and different time zones as well as operational and settlement risks are avoided in cross-border payments using XRP. “
In a comparative analysis of XRP’s features and performance metrics versus those of other major digital assets like Bitcoin (BTC) and Ether (ETH), Ripple outlined the main benefits of XRP.
Comparison of XRP features with those of BTC, ETH, BCH and LTC. Source: Ripple
India’s uncertain environment for cryptocurrency regulation
Ripple’s cryptographic policy paper comes amid long-standing uncertainty for digital assets in the country. After the Indian central bank banned local banks from serving cryptocurrency companies in 2018, the legal status of cryptocurrencies was unclear as the Reserve Bank of India simultaneously claimed that there was no crypto ban in the country.
After the Indian Supreme Court lifted the RBI’s banking ban in March 2020, the Finance Ministry allegedly proposed a general moratorium on June 12.
India isn’t the only country that has been engaged in “regulatory ping pong” with the cryptocurrency industry. Russia has also offered little certainty for cryptocurrency-related businesses as local authorities still disagree over the legal status of digital assets.
Cointelegraph reached out to Ripple to find out if the company plans to assist other countries in adopting crypto regulation, but has not received a response at press time.
Ripple approaches the Indian market as XRP is beaten by Tether
Ripple’s proposal for cryptocurrency regulation in India comes shortly after XRP lost its long-standing position as the third-largest cryptocurrency by market cap. As reported on May 25, the leading stablecoin Tether (USDT) overtook XRP to become the third largest cryptocurrency by market capitalization.
As of press time, XRP’s market capitalization is $ 8.5 billion, while Tether’s market share is $ 9.2 billion.
