About three years ago, India rejected Facebook’s offer to offer free Internet services to its citizens, calling it “digital colonialism.” Today, the social media giant's cryptocurrency project Libra may have suffered the same fate in Asia's third-largest economy.
Earlier, it was reported that India would be Libra's preferred distribution market.
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According to Bloomberg News, Indian Economic Affairs Minister Subhash Garg said Libra is unlikely to get the government's approval. Garg hints that, like other cryptocurrencies, the Indian government will not make an exception because of Libra:
"The design of the Facebook currency has not been fully explained. But whatever it is, it will be a private cryptocurrency, and this is not ours."
First ban cryptocurrency, then ban Libra?
Just last year, the Central Bank of India (RBI) also banned all financial institutions within its scope of supervision from providing services to the cryptocurrency business. The hardest hit was the cryptocurrency exchange, which has either closed or moved its operations overseas since the Indian central bank issued an injunction. It has also been previously reported that a draft for 10 years imprisonment for those who mine, buy, hold or sell cryptocurrencies is under consideration.
However, if India maintains its current position on the issue of cryptocurrency, Facebook will be blocked from the world's second most populous country, which will be a heavy blow to the social media giant, because India is the largest and growing platform of Facebook. One of the fastest markets.
Attractive Indian market
Take WhatsApp as an example. India is the world's largest instant messaging application market with more than 200 million users. As for Facebook's main app, it is estimated that there are more than 300 million users in India alone.
Facebook has said that one of Libra's goals is to provide more financial services to people without bank accounts. According to statistics compiled by the World Bank two years ago, 11% of the world's non-bank account population lives in India and is rejected by India. Outside the door will make Facebook lose its second largest market in the world.
India is not playing, is there any other choice for Facebook?
Garg's remarks are unlikely to surprise Facebook, as the technology company has realized that Libra's entry into India is not easy.
A Facebook spokesperson said in an email: "We have no plans to launch Calibra in India." This virtually eliminates the possibility of Facebook launching cryptocurrencies in India. "You may know that there are some restrictions in India, and Calibra is currently not available here."
Alexandru Voica, a Facebook representative in London, said on the phone, “Calibra will respect this law. But we are looking to work with regulators to see if this law can be updated.”
The cryptocurrency developed by Facebook will be controlled by a special organization. However, this is still at a very early stage, Voica said.
Facebook has discussed with Libra cryptocurrencies and Calibra digital wallets with governments. “The Libra Association is communicating with potential partners from around the world,” Voica said, but did not say whether to talk to the Indian government or to talk to Indian partners. “The blockchain project has multiple uses in smart contracts, supply chain management, etc. – it's not just for cryptocurrencies.”
India can't be a testing ground for Facebook, so which countries will they choose instead?