Former Coinbase CTO Balaji Srinivasan says India must enable cryptocurrency payments and related services for its citizens on several government-backed applications, as per a blog post over the weekend.
He proposed adding cryptocurrencies to ‘IndiaStack,’ a set of national APIs for payments, identity, KYC, e-signature, and document verification that is used by government applications to facilitate services for billions of Indians.
How do we connect the trillion dollar cryptoeconomy to the billion person Indian economy?
Add crypto to IndiaStack. Use the digital rupee for domestic commerce and crypto protocols to attract international investment. And bring India to the frontier. https://t.co/nV71OwWsnj
— balajis.com (@balajis) April 10, 2021
Add crypto to everything
Srinivasan, of Indian ancestry, is a popular Bitcoin and cryptocurrency proponent who previously built and sold the token-based social network Earn.com to Coinbase. He is currently an angel investor focusing on cryptocurrencies and says the sector presents a massive opportunity for the world’s second-most populous country.
“India can leapfrog the US and China to emerge as the global leader for decentralized finance if it enables cryptocurrency functionalities on existing public digital platforms including the UPI and Aadhaar,” he said in a concept note.
UPI is a feeless, digital payments framework that facilitates instant real-time payments in India. Aadhar, on the other hand, is a free-of-cost verification number available to all citizens. Both the protocols have been fully rolled out in the country in the past decade—and are available to 1.3 billion Indians.
“The internet connected the average Indian to millions of sources of information. Could crypto protocols connect Indians to millions of sources of capital?” https://t.co/6C2wWLUKRw
— balajis.com (@balajis) April 10, 2021
As per Balaji, adding crypto to IndiaStack could help solve the various oversight risks in regulating such digital payments while attracting billions of dollars in investments to the country.
The note even explored a rather far-fetched idea (for now) of India pursuing a ‘Decentralised Movement’ where countries could economically benefit from Bitcoin and Ethereum while ensuring no centralized control.
“The NationStack concept is a long-term vision for India to help every country gradually replace services managed by American and Chinese corporations with locally-operated tech platforms and national digital currencies,” Srinivasan explained.
The ex-Andressen Horowitz GP stated that startups and students could benefit via crypto crowdfunding and DeFi platforms—and even “personal” tokens.
Ahead of drastic laws
Meanwhile, the note was generally well-received in the crypto community, with influential personalities like Infosys founder Nandan Nilekani embracing the idea of a crypto economy.
How does India become a $5T economy? We’ll need to close the $250B financing gap for India’s small businesses by attracting global, risk-tolerant pools of capital — and as iSPIRT details, the rapidly growing cryptoeconomy may be one of the key ways: https://t.co/LWx1EYD2Vm
— Nandan Nilekani (@NandanNilekani) April 10, 2021
As such, it comes amidst rumors of stern regulations for cryptocurrency investors and traders in India.
Reports from last month that cited officials said holders of crypto assets could face hefty fines and possibly jail time, in what could be some of the most drastic laws imposed by any countries with regards to cryptocurrencies. But can Srinivasan’s note be an eyeopener for those officials?
