Amidst the huge regulators’ involvement and FUD, Indian crypto exchanges witnessed a sudden panic selling which resulted in a midnight crash dumping the dollar-linked stable coin tether (USDT) by 25% to nearly 60 Indian Rupees ($0.8061). This happened just after the news on the cryptocurrency bill went viral on Wednesday.
The global crypto market has started gaining some bullish momentum after around a 20% global drop in the past few weeks, but the Indian market saw something totally different.
The crash wasn’t just limited to Tether but also reflected on multiple top coins, including king coin Bitcoin (BTC), largest altcoin Ethereum (ETH), meme coins Shiba Inu (SHIB) and Dogecoin (DOGE), and Metaverse hero Sandbox (SAND).
The crypto price crash
The crash occurred soon after the so-called “government-funded” media channels created FUD around crypto. An interview on a local media channel even said that the only choice Indians have is to sell all their cryptocurrencies and never return back.
As per local sources, the Indian government is reportedly planning to roll out a bill seeking to ban private tokens while allowing specific exceptions to support blockchain technology.
The announcement of the bill came through the Parliament, which stated that the country would introduce and list 26 new bills, including the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, in the upcoming Winter session.
The bill seeks a legislative vote and discussion over creating an official virtual currency while banning “all private cryptocurrencies,” starting Monday.
The major sell-off on the Indian exchange platform WazirX this morning at 3:30 am UTC slipped the Bitcoin price by around 15%, from 4,600,000 rupees (around $61,800) to 3,917,659 rupees (around $52,600) within two hours. Other popular coins like Ethereum and Cardano also fell by double-digit losses on the exchange.
Statements from founders
Nischal Shetty, CEO of the WazirX, said that the Indian market usually trades above the global market. He added that the latest events might lead to Indian markets reaching the global market levels.
Bitcoin market CEO Caroline Bowler said that the current ban is for the short-term and would be a step backward. He added that banning could not protect investors.