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Is there a crypto ban in India or not: Government may ban cryptocurrency

 

Crypto ban or not in India: The latest news is the possibility of the government banning cryptocurrency. According to the Lok Sabha Bulletin posted on Tuesday, the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, “will provide for certain exceptions to the promotion of cryptocurrency and the technology underlying its purposes.”

Is crypto banned in India or not?

During the winter session of Parliament, which begins on November 29, the government plans to introduce a measure to ban private cryptocurrencies and create a framework for an official digital currency issued by the Reserve Bank of India (RBI).

NS cryptocurrency And the Official Regulation of Digital Currency Bill, 2021, according to a Lok Sabha bulletin posted on Tuesday, “will provide for certain exceptions to promote the underlying technology of cryptocurrency and its purposes.”

cryptocurrency ban in india

In July, the RBI announced that it was developing its own digital currency, the Central Bank Digital Currency (CBDC).

“CBDC is a digital form of fiat money issued by a central bank. It functions similarly to fiat money and can be exchanged for fiat money in a one-to-one ratio. CBDC is a digital or virtual currency, but This is different from private virtual currencies that have increased in the recent decade. According to RBI Deputy Governor T Rabi Shankar, the historical idea of ​​money is different from that of private virtual currencies.

India, which has experienced a surge in investor interest in cryptocurrencies and many investors already have, continues to advise residents to invest in cryptocurrencies, citing serious financial risks as a reason. .

Prime Minister’s Conference on Crypto Ban

Prime Minister Narendra Modi earlier this month chaired a conference to examine the future of cryptocurrencies and cautioned against bitcoin falling into the wrong hands. The Center has also said that it intends to amend the income tax rules to bring cryptocurrency income into the tax net. It will do so during next year’s Union Budget.

The Reserve Bank of India has stated on several occasions that cryptocurrencies, such as Bitcoin, Ethereum and Dogecoin, pose a risk to financial stability. It has also questioned claims of its market value, urging investors not to be “greed” by the cryptocurrency’s promise of returns.

However, in March this year, the Supreme Court struck down an RBI circular prohibiting banks and businesses regulated by it from providing services related to virtual currencies, which was issued on April 6, 2018. .

What if the government chooses to repeal the crypto ban in India?

If the government chooses to restrict the use of crypto, all transactions between your bank and your crypto exchanges will be stopped. You will not be able to buy any cryptocurrency using your local cash. You will also be unable to redeem them.

There are currently no rules or prohibitions regarding the use of cryptocurrencies in the country. Notably, in recent years there has been an increase in the number of advertisements, some even featuring movie stars, that promise simple and large returns on cryptocurrency investments.

Prime Minister Narendra Modi met with top officials last week to discuss cryptocurrencies, and there are signs that stricter regulatory measures may be in place to address the problem.

The Reserve Bank of India has often expressed its opposition to cryptocurrencies, claiming that they represent a serious threat to its macroeconomic and financial stability. This has raised questions about the number of investors trading on them as well as their perceived market value.

Bill 2021 on Crypto Ban and Official Digital Currency Regulation in India

The bill aims to “provide a conducive environment for the development of an official digital currency of the Reserve Bank of India.” The measure also seeks to ban all private cryptocurrencies in India, with few exceptions, to encourage the core technology and applications of cryptocurrencies.

bitcoin ban in india

Since the inception of bitcoin in 2008, hundreds of other cryptocurrencies have been exchanged on private exchanges around the world, including in India. Bitcoin is often considered the most accepted investment of the last decade due to its meteoric rise. Starting at around 10 cents, the coin was trading for over $60,000 until last week.

Is there a connection between money laundering and terror financing?

Sources separately claimed on Saturday that Modi recently held a conference to explore the future of cryptocurrencies, amid concerns that unregulated crypto marketplaces could become carriers for money laundering and terror funding.

According to an industry insider who spoke at a separate parliamentary panel session on Monday, the new laws are expected to hinder cryptocurrency marketing and promotion, reducing its appeal to individual investors.

Two sources told Reuters that the government is considering classifying cryptocurrency as an asset class, rather than a currency, desired by crypto exchanges.

However, according to Reuters, the idea is to eventually ban private crypto-assets, while paving the way for a new central bank digital currency (CBDC).

Despite expressing “serious reservations” about the private crypto ban in India, the Reserve Bank of India is planning to set up a CBDC by December.

The world’s most popular cryptocurrency, bitcoin, is now trading at around $60,000 (€53,000) and has more than doubled in value since the beginning of the year, attracting a slew of local investors.

There are no official figures, but the industry estimates that there are 15-20 million cryptocurrency investors in India, with total crypto holdings of around Rs 400 billion (€4.77 billion).

An email requesting a response from the Finance Ministry was not returned.

According to various sources, on Saturday, Modi held a meeting last week to discuss the future of cryptocurrencies amid concerns that unregulated crypto restrictions in India’s markets could become a vehicle for money laundering and terror funding. could.

According to an industry insider who spoke at a separate parliamentary panel session on Monday, the new laws are expected to hinder cryptocurrency marketing and promotion, reducing its appeal to individual investors.

Is it possible that another crypto ban is coming to India?

According to sources in India’s crypto community, the Indian government is unlikely to ban all cryptocurrencies outright. When India’s national bank, the Reserve Bank of India (RBI), attempted to ban all cryptocurrency trading, the Supreme Court reversed it. In addition, the Central Board of Secondary Education (CBSE) and Maharashtra, an Indian state, are adopting blockchain technology to create tamper-proof certificates. “Without a rich and capable cryptographic environment, many of these blockchain use cases would not operate,” Reddy said.

India admits that it can no longer ignore cryptocurrencies.

There is a lot going on in the area right now that can turn a blind eye to whether the Indian government supports a crypto ban in India.

India’s Prime Minister Narendra Modi issued a stern warning a week ago at a session organized by the Australian Strategic Policy Institute. “All democratic countries should work together on this to ensure that it does not fall into the wrong hands, spoiling our children,” he said.

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