TL;DR Breakdown
- India says it is not banning cryptocurrencies.
- Instead of a ban, govt says it will regulate crypto.
- Finance secretary supports regulation of crypto other than a ban.
Contrary to popular reports that India would be placing a ban on cryptocurrencies, the government has dispelled the news noting that rather regulations would be put in place for the Indian crypto space.
Before now, the crypto community in the country has been filled with an air of anxiety as everyone had been waiting to receive a government confirmation on crypto ban.
However, in a twist, a local report in India stated that there would be a new crypto bill expected to be approved by the Cabinet by the end of next week.
Indian Government Passes Crypto Note, Issues Regulatory Framework
According to the Cabinet note that the government circulated, a few changes will be made to the new crypto bill. They are highlighted below:
The note suggests that cryptocurrency is not recognised as a legal currency in the country. Legislation will now refer to as ‘crypto assets’ and not cryptocurrency. Crypto will not be recognized as a legal tender. At least not yet. There’ll be no banning of private cryptocurrency, they will only be regulated. Crypto in the country will be regulated by the Securities Exchange Board of India (SEBI).
Also, the Reserve Bank of India (RBI) has not been clubbed with the new bill. An ultimatum will be given for those who have crypto assets to bring them under-regulated crypto exchange platforms. Anyone found violating the stipulated regulations will be penalized with punishments of up to 18 months with an additional penalty of between 5 to 20 crore.
Finance secretary speaks on crypto ban in India
The author of India’s crypto bill, former Finance Secretary Subhash Garg, also dismissed the report of a potential ban on crypto as he highlighted the many potentials of cryptocurrencies and blockchain technology.
“[The description of the crypto bill] was perhaps a mistake. It is misleading to say that private cryptocurrencies will be banned and to intimate the government about the same,” Garg said.
He recommended that the government should formulate a bill after discussing it with stakeholders and crypto investors.
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