Uncertainty around India's crypto policy is making blockchain firms anxious

 Bureaucrats say they want blockchain, but not cryptocurrencies. It's as silly as wanting airports with duty-free shops but no flights

Contradictory statements and media leaks are making it impossible to get a handle on India’s soon-to-be-unveiled cryptocurrency policy. The uncertainty is throwing young blockchain firms and programmers into a paroxysm of anxiety: Should they leave or stay? If they hang back, should they do something else with their lives?

On Sunday, the global crypto industry heaved a sigh of relief when Finance Minister Nirmala Sitharaman categorically ruled out a much-feared blanket ban, promising to allow a window for people “to do certain experiments” using distributed ledger technologies, Bitcoin and other virtual currencies, she said at an India Today conclave.

But before the ink could dry on the congratulatory press releases from entrepreneurs, Reuters cited an official with direct knowledge of the plan as saying that the new law will “criminalize possession, issuance, mining, trading and transferring crypto-assets.”

That will be nothing short of a second existential crisis in three years. India’s crypto evangelists fought a brave legal fight — a couple of them even went behind bars for a short while — against the monetary authority’s 2018 diktat to banks, telling them not to allow anyone dealing in digital assets to operate an account. Last year, the nascent blockchain industry won when the country’s highest court set aside the Reserve Bank of India’s order.

Optimism started to rebuild, and surging Bitcoin prices began to lure millennials. When it comes to transferring Bitcoin and other digital assets, India is of late providing more volume than China on popular peer-to-peer platforms.

The risk that India would hit back with a new law to make criminals out of crypto professionals and investors was always present. So practitioners tried to educate policymakers, appealing for sensible regulation starting with definitions for what is a utility token, which digital asset is to be viewed as a security, and which is to be treated as a currency.