The Crypto ban that will never happen.

If China (the world’s most powerful dictatorship ) didn’t attempt to ban crypto holdings, India never can.

Photo by Dawid Zawiła on Unsplash

Indian govt has threatened an outright ban with a 10-year jail term for anyone holding a cryptocurrency

There is a ‘Draft proposal’ that is floating around the internet which imposes a blanket ban on anyone holding cryptocurrency with a 10-year non-bailable term ( which is frankly a lie pushed my news articles to get clicks )

Now there are so many logical judicial political and economic issues with this idea that this will never ever see the light of the day.

First things first, cryptocurrencies are not like radioactive substances that emit radiation so that the govt can easily sniff them and catch the holders, they are lying on your phone, computer and even paper.. so catching offenders is nearly impossible this way.

Having said that, there are over 2000 cryptocurrencies on Coinmarketcap.com and 1000s more invented every day,

so the question is govt imposing blanket on all these new coins ??

If so will govt imprison a 5-year-old kid who accidentally holds crypto as he earned some crypto when he played a game ??

will Govt imprison millions of people who earn BAT through the brave browser?

will Govt imprison billions once Facebook goes live with their proposed crypto?

now some of you might think, well govt will not ban individual citizens but only traders? On what basis I ask them. Even traders are citizens of a country and they have a fundamental right to life and liberty.

If you can’t arrest someone for possession of crypto, you can’t arrest a trader for holding the same …This is the fundamental law of equality.

Now let’s say govt comes up with a rule saying they will arrest folks who hold more than $10,000 , there is one tiny issue here … first things first … cryptocurrencies have this annoying ‘anonymity’ feature which makes it nearly impossible to establish strong Identity connection, so courts can never put anyone in jail for holding any amount of cryptocurrency.

In the worst case, users can simply transfer the cryptocurrencies to other wallets ( which happens by default in HD wallets )and stay within the legal limit of $10,000 or whatever.

Unless citizens disclose their holdings voluntarily, govt has no way of knowing how much anyone owns precisely, this dear reader is not a good way to implement strong laws.

Here’s where the ban really really backfires.

Imagine govt does manage to arrest someone for holding some amount of crypto ( not 5-year-old kids, in which case there will be riots on streets ). This news will spread like wildfire with most media shilling 24/7 about what cryptocurrencies are and the best ways to avoid holding them. This fear psychosis will create the most powerful PR that cryptocurrencies can ever get as everyone wants to avoid jail time no matter how remote it is.

As days progress, the media houses will start discussing the justifications for the ban and the arguments will start falling one another and slowly govt will lose trust in the eyes of people. This in a democracy is a nightmare for any politician with the hope of re-election. Not to mention by this time, crypto friendly entities will be lobbying hard to stop harassing cryptocurrencies ( DAO like Dash or EOS worker proposals can be really helpful in these scenarios which theoretically can even bribe politicians without impunity :) ).

People in the street don’t care /understand money laundering, KYC, Anti-terrorism, inflation, and gazillion other financial laws and will never agree to be jailed for these silly reasons.

The only real option for Govt to stop cryptocurrencies will be to kill the nodes on which they run, however legally even this is not possible in places where there is strong of rule of law .. like US, UK, Switzerland.

Having said that the easiest way to stop nodes from going dark is paying them up. Proof of stake systems & Proof of service systems like EOS, Dash and many more coins are the only ones that can ultimately stand the heat of governments as the node count of bitcoin hits a new low every day.

As you know, Money is the most powerful force in this world and no matter how many laws, threats govts come up with, if there is an easy way to make money ( by simply running a node ) people will do it.

As most crypto fans know, we just need a couple of full nodes to resurrect the entire network to its full health.

The game of killing cryptocurrencies is not going to easy even in most oppressive regimes like that of China let alone strong democracies like the US where courts routinely stop presidential laws from getting into action.

The best option for any Govt is to swallow this very very bitter pill and realize their days of unlimited money printing for all sorts of reasons is over. No matter how hard Govts fight, they have no option to win this war. The current cancerous financial system gives Govt unlimited power to extract as much wealth ( in the form of ever-increasing taxes and endless inflation ) from the hard-working taxpayers with no recourse. All these tax refugees will eventually take refuge under cryptocurrencies.

History has shown that ‘A decentralized system grows stronger with every attack compared to a centralized system and is nearly impossible to destroy by a centralised system’.

Today’s financial system is one of the most centralized in human history and that alone creates so many risks for our collective well being, but thankfully cryptocurrencies will do the job for us so long as you love making money with them while fiat currencies lose their value with every passing minute :P