After several rounds of surveillance, the government may be more inclined to impose certain crypto restrictions in India for the public benefit.
During the rise of cryptocurrency euphoria in India, there has been a rapid development on the way forward for digital currencies when RBI governor Shaktikanta Das kicked it out with a loud warning to cryptos.
Cryptocurrencies are a major problem in terms of economic and financial stability, Das said a few days ago, while reiterating his recent stance, saying, “There are serious problems” involved in real money that could pose a threat to India’s economic and financial stability. “
On the other hand, Prime Minister Narendra Modi held a high-level conference recently, in which he expressed concern about unregulated crypto markets becoming a means of money laundering and terrorist financing.
There was also consensus, during the Prime Minister’s meeting on how to stop the extremely promising and misleading advertisements for new investors.
The Parliamentary Standing Committee on Finance met with various stakeholders and experts, for the first time on the cryptocurrency panel and related issues. The panel focused on cryptos control but did not completely close the door on it.
Members of Parliament are said to wish government officials to appear before it to address their grievances. There was an agreement that a regulatory framework should be put in place to regulate crypto currency. Industry organizations and stakeholders were not clear on who should be the regulator.
Members of Parliament (MPs) have expressed concern about the financial security of investors.
In the midst of all these developments, there are reports that the government may introduce a cryptocurrency Bill in the Winter Session of Parliament. The proposed bill will focus on the protection of investors as cryptocurrencies fall under the category of complex assets.In the meantime, let’s take a look at what India can and will not allow when it comes to cryptos.
First, India has had a hot and cold relationship with digital currencies over the past few years. In 2018, it successfully closed crypto transactions following a series of frauds following Modi’s sudden decision to liquidate 80% of the country’s currency, but the Supreme Court overturned the law in March 2020.
After the Supreme Court overturned the RBI’s order, which effectively lifted the ban on cryptocurrency trading in India, the country’s insanity grew at an alarming rate.Following this on February 5, 2021, the central bank had established an internal panel to promote the digital currency model of the central bank.
A panel of cryptocurrency ministers under the chairmanship of the Secretary (Economic Affairs) recommended that all funds other than those issued by the state should be banned.
The Reserve Bank of India (RBI) has reiterated its strong opposition to cryptocurrencies, saying it poses serious threats to the country’s economic stability and financial stability and doubts the number of investors trading in them and their market value.
Currently, there are no specific laws or restrictions on the use of crypto currency in the country. The union government has not yet enacted legislation on cryptos, but is consulting with industry experts, commenting by various officials and ministers.
After many rounds of surveillance, the government may be more inclined to impose certain restrictions on cryptos in India for the benefit of the community. However, since the recent PM meeting, the general view within the government is that the steps taken will be faster, “continuous and forward” as cryptos represent evolving technology.
The crypto community has made several submissions to the Indian authorities requesting classification as an asset instead of money, in order to gain acceptance and avoid restrictions.Opportunities are being considered by the government that crypto currency may be restricted to the use of transactions or payments, but allow it to be held as assets such as gold, stocks or bonds, the Economic Times reported.
The Securities and Exchange Board of India (Sebi) may be appointed as a regulator, although that has not yet been finalized, according to the same report.
India’s digital currency market was worth $ 6.6 billion in May 2021, compared to $ 923 billion in April 2020, according to the blockchain Chainalysis data platform.