By Samuel Indyk
Investing.com – The price of Bitcoin tumbled on Monday after hitting a record high over the weekend with some focus on reports that India will propose a law banning cryptocurrencies.
Over the weekend, the price of the world’s largest cryptocurrency by market cap broke above $60,000 for the first time, reaching a high of around $61,700 before some of the recent gains were pared.
India Cryptocurrency Ban
A long awaited decision on the Indian government’s stance on cryptocurrencies looks to be forthcoming. On Sunday it was reported that India will propose a law banning cryptocurrencies, fining anyone who trades or even holds cryptocurrencies.
The news that the world’s second most populous country is set to completely ban trading in and holding digital assets will come as a blow die to the wide ranging nature of the bill. Possession, issuance, mining, trading and transferring cryptocurrencies will all be criminal offences according to the official who has spoken to Reuters.
The measures would be even more strict than the current law in China, which has banned mining and trading of cryptocurrencies but not possession.
The proposed ban should have no problems becoming law Prime Minister Modi’s government holds a large-sized majority in parliament.
Bitcoin
Even with today’s pullback, Bitcoin is still up over 1000% in the last 12 months after having a remarkably strong start to 2021 due to corporate interest in digital assets.
After Tesla revealed they bought $1.5bln of bitcoin to diversify reserves in February, the cryptocurrency shot up and other major companies such as Bank of New York Mellon (NYSE:BK) and Mastercard (NYSE:MA) also announced forays into the space.
Whether the latest news from India will be a the start of a more terminal decline is unclear but the price of bitcoin has historically been volatile and has had numerous large price swings, most notably in 2017 after the huge rally which was then followed by a price crash.