In bad news for crypto enthusiasts, digital currency trading may see a blanket ban in India if the recommendations by the government-appointed panel are accepted. The panel’s draft report, the ‘Banning of Cryptocurrency & Regulation of Official Digital Currency Bill, 2019’, mandates a fine and imprisonment of up to 10 years for offences. The Reserve Bank of India (RBI) last year in July had already issued a ban on cryptocurrencies. However, the committee chaired by Economic Affairs Secretary Subhash Chandra Garg too has suggested the government to keep “ an open mind for a certain bank digital currency” which is based on the similar blockchain or distributed ledger technology (DLT).
Over the years, other than popular Bitcoin some other cryptocurrencies have emerged namely Ethereum, Ripple and Cardano. Even as some countries have recognised the digital currencies as mode of payment, it is not allowed as legal tender anywhere. The neighbouring China has put a complete ban on these currencies, while Japan, Thailand and Switzerland have recognised them as payment means. Nations such as Russia and China allow these currencies to be traded for the purpose of other goods and services.
The Parliament was informed by the Minister of State for Finance & Corporate Affairs earlier this month that no decision has been made yet on licensing and authorising any entity or company to deal with any digital currency. “The committee, with representations from MeitY, RBI, Sebi and CBDT is examining all issues, including the pros and cons of the introduction of an official digital currency in India and is working to develop a framework for regulating crypto currencies,” the Minister of State for Corporate Affairs had told the Lok Sabha.
A panel was appointed by the government to look into the issues related to the digital currencies and also the advantages and disadvantages of the introduction of an official digital currency. All the digital currencies are not considered legal tender in india.