Friday, December 6, 2019

Report: India Contemplates Complete Ban of Cryptocurrencies

Grace Joseph
Freelance Writer, Blogger, and Crypto Enthusiast. Studied Computer Science in University and Undergoing a Masters Degree Programme in Computer Engineering [email protected] [email protected]

When it comes to countries that are not receptive to cryptocurrencies, we have India on one hand and China on the other hand. While China may have taken a bold step to ban the trade of crypto assets, India is still dancing around the line. A report by Economic Times on April 26 reveals that the South Asian country may be taking a more serious approach after all.

India Begins Inter-ministerial Consultation to Discuss Draft Bill

According to the media, India has begun an inter-ministerial consultation in order to discuss a draft bill aimed at banning cryptocurrency and regulating official digital currency. The draft, “Banning of Cryptocurrencies and Regulation of Official Digital Currencies Bill 2019” has been sent to officials from different government departments.

The departments agree that the sale, purchase, and even issuing of cryptocurrencies should be banned. The departments, on the other hand, which have been named include Central Board of Direct Taxes (CBDT), Department of Economic Affairs (DEA), and the Investor Education and Protection Fund Authority (IEPFA).

Committee, it has Taken Too Long to Take Actions Against Crypto

A committee made of officials from some of these departments has also outlined that it has taken too long for the government to take actions against cryptocurrency. According to them, a ban can be achieved by categorizing cryptocurrency under the Prevention of Money Laundering Act (PMLA) since these assets can be used for the money laundering.

While it may be a draft bill, further reports revealed that whatever is decided upon, the final law will be proposed to the new government after the country’s election in May. Prior to this time, a panel had been formed under the Subhash Chandra Garg, India’s finance secretary in order to draft a bill that will regulate cryptocurrencies in 2018.

Crypto Sale is Done by Companies on False Inducements of Huge Returns

Reportedly, the ministry of corporate affairs is of the opinion that the sale of cryptocurrencies is carried out by companies on false incitement of huge returns. The ministry has also hinted that the bill may take long to implement and as such, those defrauding others and laundering money with the use of cryptocurrency should be prosecuted for the time being before a detailed bill is established.

While it is still uncertain whether India will follow through with these claims, the ban on cryptocurrencies in the region could impact negatively on these assets. But like China which did that in the past, the crypto market which has matured since then may be stronger this time around to withstand another hit. On the other hand, some banks in the India have been closing a customer’s account for buying bitcoin, and it may not come as a surprise if the country follows through with it.

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