Govt to take a final call on cryptocurrency bill
The finance department has put the cryptocurrency bill into final form. The Indian government and the stakeholders dealing with cryptocurrency felt the need for much-detailed consideration of certain aspects of it
Cryptocurrency is the new fad in the trading market recently. Investors are flocking to park their money in this investment vehicle due to the attractive returns it fetches for them. But investors and the regulatory framework are skeptical about its legality due to the secretive nature of the transactions of private cryptocurrencies. Amidst these confusions, our PM Narendra Modi has announced that he will take a call on this Suo- motto to cast aside the doubts regarding the legality of cryptocurrencies. Moreover, the cryptocurrency and regulation of the official digital currency bill is up in the air for consideration during the Parliament winter session 2021.
PM conducted a high-level meeting on Thursday
The finance department has put the cryptocurrency bill into final form. The Indian government and the stakeholders dealing with cryptocurrency felt the need for much-detailed consideration of certain aspects of it. A comprehensive discussion detailing the pros and cons of adopting cryptocurrency before adopting them as a currency for various transactions.PM Modi conducted a high-level meeting to consider the concerns of stakeholders, including those raised by the RBI. The principal consideration was whether:
- To ban all the cryptocurrencies altogether?
- To allow trading on all types of cryptocurrencies with restrictions?
- To allow selected cryptocurrencies with regulations attached to them?
- To impose a partial ban on cryptocurrencies?
The proposed bill is an old bill ready for tabling and passed a law last session. But the government wanted to consider some features to avoid future confusion before making it an official digital currency of the nation. The government intends to create a favourable framework for digital currencies using blockchain technology in India. The Finance minister of India-Nirmala Sitaraman assured that the bill would be introduced in the Parliament once the cabinet approves it.
Why there is a need to regulate cryptocurrencies?
PM Modi told last Friday that technology like social media and cryptocurrency should be used positively and not to undermine the purpose of democracy. Global norms for these are essential to safeguard democracy while encouraging the use for the welfare of the people.
Along with the floating concerns to either impose a complete or partial ban, the government will also consider a ban on exchange-to-exchange transfer. The sources intimate that the government is all set to ban chrome extensions, trade bourses and private wallets that hide the identity of the people involved in a transaction.
Furthermore, the government will create its wallet to monitor the transactions. Reliable sources also reported that the government is planning to oversee all the transactions, to control the influx of money through cryptocurrency exchanges. The government also plans to allow those exchanges to function, who will open their ledger to the government every three months. This way, the government can ensure transparency in the working of cryptocurrency in the nation.
Norms to be followed by Crypto holders
India is about to make a brilliant move to empower capital market regulators to control cryptocurrency transactions. The central government plans to give a time limit to the crypto holders to disclose assets held by them. Anyone who fails to comply with this rule should pay a fine of a 200million INR or face a jail term of 1.5 years. The proposed bill would mention cryptocurrency as a crypto asset and will not consider RBI's intention to introduce crypto as RBI digital currency.
