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Cryptocurrencies and other digital assets have clashed with authorities over their legitimacy since their creation. However, in 2018 they made a lot of headway in getting legalized by many state entities. Countries like Thailand, South Korea, France, and the U.S. have passed laws and regulations to provide better oversight and encourage the crypto market in their regions. The latest country about to lift the ban from holding cryptocurrencies like Bitcoin is India.
Back in April, India banned Bitcoin. The Central Bank of India, Reserve Bank of India released a press statement saying that Bitcoin and other cryptocurrencies were officially banned. The statement also said that entities regulated by the Reserve Bank of India will not be dealing with or provide services to any business or individual dealing with cryptocurrencies due to the risks it possesses. The Reserve Bank of India said that it would provide a notice period of 3 months to stop providing services related to virtual currencies for entities already doing so.
However, India might be about to legalize Bitcoin and other cryptocurrencies again as the second interdisciplinary committee is in favor of legalizing it; however, with some strict conditions. The New Indian Express quoted a senior official saying, “We have already had two meetings. There is a general consensus that cryptocurrency cannot be dismissed as completely illegal. It needs to be legalized with strong riders. Deliberations are on. We will have more clarity soon.” The New Indian Express reported that the committee has met twice on the issue and could submit its report to the finance ministry by February 2019.
The committee was first set up in March 2017 and it recommended a ban on cryptocurrencies with immediate effect. The RBI took the committee’s advice and rendered cryptocurrencies illegal quickly following by the finance ministry. But RBI said that it will be launching their own fiat currency. However, the RBI fiat was challenged in the Supreme Court by several stakeholders. As a result, the government set up a second committee led by Subash Chandra Garg.
“We have also taken inputs from cryptocurrency exchanges and experts,” one official said, “and will be examining legal issues with the law ministry. It’s a complicated issue. Once all aspects are decided, then we will have more clarity.”
Distributed ledger technologies are on the verge of being reintroduced to the world as something more than mere virtual currencies because of the surge of innovation in the field. India’s new legislation would be one step further in defining the future of said technologies in the country.