Laws about Bitcoin are in a gray area today across the is bitcoin mining legal. I studied documents from the Reserve Bank of India’s public repository surrounding Virtual currencies and prepaid solutions.
I happened to study two documents about Prepaid Payment and Foreign Exchange Management Rules, 2000. Why research Prepaid Payment rules? Although Bitcoin is in no way related to this, I wanted to see how close I could get to any laws that could present a roadblock. Is Bitcoin Regulated in India? The RBI regulation on Prepaid Payment Instruments in India defines a lot of areas.
After understanding the documents of RBI’s guidelines and Rules, this is where I could find the only roadblock based on regulation. Fiat will fade away as more people adopt Bitcoin. Until that frictionless free flow between consumers and merchants is made possible, this is a problem area for Bitcoins entry into India. There are enough Smartphones to cause this market to explode in any sponsor’s favor.