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Many countries are trying to crack down on cryptocurrencies and rumor had it that India might be next in line to completely ban their use. However, talking to the local media news outlet Inc42, India’s Minister of State for Finance Anurag Thakur put these rumors to rest.
According to the Minister of State Finance, to determine the legality of cryptocurrency in India, first there should be some set rules. Law enforcement agencies under which this matter falls, such as the Reserve Bank of India (RBI) and income tax authorities, work under a set of already existing laws and currently there are no laws against cryptocurrencies.
The comment came when Member of Parliament (MP) Dharmapuri Srinivas asked Anurag Thakur about the government’s stance on cryptocurrency and whether it is banned or not. Thakur replied with a firm no. However, he went on to comment on how issues of cryptocurrencies exist and how the government and RBI are continuously working on making public more aware of these issues through press releases and circulars.
Recently, RBI did bar all of the registered banks from having any type of transaction with businesses related to cryptocurrencies. Bitcoin suffered a blow to its value after this ban, but as it is now confirmed by Anurag Thakur, there is no blanket ban on virtual currencies yet.
Strong Anti-Crypto Sentiments from the Indian Government
Even though there are no laws yet, a draft bill has been making rounds on the internet, which if passed, will criminalize any type of trading or mining of cryptocurrency in India. Known as “Banning of Cryptocurrency and Regulation of Official Digital Currency Bill 2019,” this bill states that failure to follow the stated laws might lead to 10 years of imprisonment. It also makes holding cryptocurrency a non-bailable offence. The bill has not been made public yet, meaning that it is still under consideration and it will take time to completely ban cryptocurrencies in India.
Technology law experts, such as Namita Viswanath, have already called this crackdown on cryptocurrency by the RBI an “aggressive move.” There is still time before we become fully aware of the repercussions or benefits of banning the cryptocurrency, but there is no denying that Thakur’s statements and the leaked bill puts a lot of cryptocurrency-based startups at an uneasy spot in the country.
Indian crypto exchanges have already begun struggling in the country due to the clear anti-crypto sentiments emanating primarily from the government. At least two India-based crypto exchanges have been shut down recently, Koinex and Cryptokart.