Cryptocurrency Account: All eyes are currently on the Indian cryptocurrency regulatory bill that is likely to be included in the ongoing winter parliament session this year. In recent weeks, there has been a lot of deliberations and discussions about India’s move to cryptocurrencies, which are still unregulated in the country. According to a recent report by the Economic Times, Prime Minister Narendra Modi will make a final appeal to the bill’s regulatory framework as stakeholders have been conflicted over it. The lengthy deliberations, discussions and likely government move to make changes to the regulatory framework have delayed the bill’s submission to parliament.
“We need to work together to shape global standards for emerging technologies such as social media and cryptocurrencies so that they are used to strengthen democracy, not undermine it,” Prime Minister Modi said Friday, amid ongoing discussions about cryptocurrency regulation. the start of the winter session, the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, had notified days after a meeting of the cabinet and representatives of the Reserve Bank of India.
Here’s what we know so far about the central government’s stance on cryptocurrency regulation in India:
– PM Modi’s decision to make the final call comes after a meeting held Thursday between stakeholders, including the RBI, which has repeatedly expressed concerns about unregulated cryptocurrencies in India. According to the ET report citing sources, the possible options for the bill include “a complete ban on private cryptocurrencies, a partial ban, allowing all categories of crypto products with regulation, or only a select few with regulation”.
– Another report from ET also suggested the government might consider restrictions on exchange-to-exchange transfers. According to the report citing sources, a general ban on trading exchanges is expected, as well as restricting wallets and Google Chrome extensions that mask the traders’ identities. The government can also open its own wallet to keep an eye on transactions.
– Cryptocurrency exchanges will also have to provide quarterly disclosures to the government to maintain transparency, the report said. According to sources quoted by ET, the government is thinking of implementing a system that aims to monitor all Indian rupee inflows and outflows on Indian crypto exchanges. Only those exchanges are allowed to run in the country that is allowed to open their ledgers to the government on a quarterly basis.
India is also considering appointing capital market regulators to oversee crypto transactions, sources told ET. The report says that the central government is expected to issue a deadline for crypto holders to declare their assets to comply with the new rules. Any violator of the rule could be fined 200 million rupees or jailed for up to 1.5 years, according to the sources. The bill may also refer to cryptocurrencies as “cryptoassets” and does not refer to the RBI’s plan to launch a central bank digital currency.
– Finance Minister Nirmala Sitharaman said earlier this month that the government has reworked the law proposing to ban all cryptocurrencies, but has no plans to consider Bitcoin as an official currency in the country. She also discouraged any speculation about the upcoming bill, calling it unhealthy. She confirmed that the government will prepare a well-consulted bill before it is presented to parliament.
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