Crypto regulation is a hot debate in India. The Minister of State for Finance and Corporate Affairs, Anurag Thakur has said that the government will approach cryptocurrency regulation with an open mind. The government will also promote the adoption of blockchain technology. He said this in an interview with Times Now.
The minister further mentioned that the government is open to adopting state digital currency, and currently the RBI is working on developing its digital currency.
As per him, under the Digital India Initiative, the government has been a strong proponent across sectors for the adoption of digital technology.
He added that we must decide which technology to use. There are various kinds of cryptocurrencies available in the cryptocurrency ecosystem. The proposed Bill will take into account all factors affecting the ecosystem, including the Supreme Court’s decision in March 2020, according to the minister.
Lastly, he stated that the government is supporting the technology and will bring the Bill with open views. The issue of fluctuations in crypto assets also needs consideration to safeguard the interests of investors.
The present situation on crypto regulations
The government’s approach towards cryptocurrency seems to shift towards the softer side. In 2018 the RBI prohibited banks to transact with entities dealing with cryptocurrencies. This was later struck down by the Supreme Court in the case of IAMAI v. UOI.
The government later declared that it will ban cryptocurrencies in India based on the recommendations and a Bill proposed by the Inter-Ministerial Committee (IMC) Report of 2019. This Bill was not tabled in the Parliament for discussion.
In January 2021, the government introduced the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021. This will outlaw crypto-currencies while also giving the Reserve Bank of India (RBI) the legal authority to create a central bank-backed digital currency (CBDC).
Responding to this, the Internet and Mobile Association of India (IAMAI) proposed that India should consider crypto regulation rather than ban it as part of the January 2021 agenda. Earlies it was rumoured that the government is considering criminalizing cryptocurrency ownership.
Last Month, replying to a query in Rajya Sabha, Anurag Thakur there also mentioned that government will decide on recommendations of the IMC.
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