The government of India to abolish large amounts of paper money, resulting in bitcoin exchange premium of nearly 12% in India
The India government has abolished 1000 and 500 rupee notes of large initiatives, resulting in India people’s demand for alternative assets has greatly increased. Compared with the international market, the India market has expanded bitcoin premium.
The government claims that the abolition of money laundering is to contain large amounts of paper money
In order to solve two big problems of counterfeit money and undisclosed income, the India government announced in November 8th 1000 rupees ($15) and 500 rupees ($7.5) of large amounts of paper money, will no longer be legal tender in India. These notes will be replaced by a new version of the bill. The people of India were asked to their current holdings of money in the bank, and in exchange for new banknotes.
People are looking for alternative assets
After the India government issued the decision, India people’s demand for gold and other assets began to surge. The traditional jeweler to accept these notes will be abolished, with huge premium to sell gold and jewelry. The tax authorities launched raids, in order to prevent the jewelers for money laundering.
Bitcoin transactions grew 20-30%
In view of the fact that bitcoin is a pseudo anonymous currency, its operation is not controlled by the state, bitcoin purchases in India market increased by 20 – 30%. India’s leading newspapers, such as the times of India (HindustanTimes) and Mint, have reported bitcoin demand growth in the local market of India.
Due to the additional demand, resulting in India market bitcoin price premium
Bitcoin market demand in India increased, resulting in bitcoin exchange between India and the international bitcoin exchange rates widened the gap, as of press time, India bitcoin exchange Unocoin BTC price of about 54000 rupees ($800). This means that the exchange currency price to nearly 12 percentage points higher than the international currency exchange price. However, the Reserve Bank of India for India residents in foreign exchange restrictions, therefore, this leads to a trader cannot carry.
As with all other government money, India rupee is also a legal tender. It is because of the existence of government decrees, and from the nearest to the examples, we can see that the currency can also terminate by order of the government. With the passage of time, bitcoin as a currency advantage is becoming more and more obvious.