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Indian Parliament Introduces Bill To Ban Private Cryptocurrencies

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The Indian Parliament has introduced a new bill that would potentially regulate cryptocurrencies in India, with private cryptocurrencies on its sights. The bill, however, also details how certain exceptions can be made in order to promote the underlying blockchain technologies that cryptocurrencies operate with.

The bill, titled “The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021” has been filed for review for the Parliament’s upcoming winter session, and joins 26 other bills for consideration and passing, which begins on November 29.

The bill involves a set of regulatory frameworks for the creation of an official digital currency issued by the Reserve Bank of India (RBI). According the RBI, it is currently examining the prospect and feasibility of launching its own central bank digital currency (CBDC), a strategic decision that aligns the country with other nations such as the UK and Singapore, among others, which have already launched their own systems based on open LEDGER blockchain technologies.

The RBI, states, however, that it is still currently processing its final decision for a possible date of the pilot project’s launch. India’s Prime Minister, Narendra Modi, recently held a comprehensive review on cryptocurrencies and what type of regulatory implementation should be applied.

According to state sources familiar with the matter, the review session was exploring a “forward looking and progressive” approach to crypto regulation, while also clarifying its stance on how an unregulated market for digital currency must not become a breeding ground for money laundering and terror financing. Misleading advertisements for crypto were also highlighted during the meeting.

Industry representatives invited to the parliamentary session have suggested that a total ban may not help crypto projects and technologies move the economy forward, but that strong regulation is necessary to address the concerns of security and investor protection.

Earlier this week, Prime Minister Modi also discussed security concerns around crypto during a virtual keynote address at the Sydney Dialogue, wherein he stated that democratic nations around the world should cooperate so that crypto would not “end up in the wrong hands."

According to industry estimates, India represents the largest number of cryptocurrency investors in the world. In light of this, the Reserve Bank maintained that it will advocate for the need of a total ban towards private digital currency.

 

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 11/24/2021

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