The Indian Government has introduced a bill to ban cryptocurrencies in India. Instead, the Indian Government has introduced an official digital currency. People in India were confused about whether Cryptocurrency is legal or banned. This move is important and will now remove ambiguity that is legal or not. The RBI had banned banks from dealing with crypto exchanges but that embargo was overturned in March 2020 by the Supreme Court of India.
Cryptocurrencies are decentralized payment methods. They are not financed or regulated by any central banks like conventional fiat currencies are. This resulted in a point of worry and competition for central banks like RBI. RBI accompanies the way the European Central Bank adopted, which had issued similar warnings and warnings against cryptocurrencies.
In mid of the year 2019, the Indian government proposed to ban all private cryptocurrencies with a term jail of 10 years and a heavy fine if anyone caught in dealing with cryptocurrency.
On 29 Jan 2021, it was published on the lower house website that “The law will create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India (RBI),”.
Lok sabha Bulletin has added that “The Regulation of Official Digital Currency Bill, 2021 is likely to be introduced in the Budget Session of the Parliament”. The bill if passed will ban cryptocurrency, and payments through cryptocurrency will also be banned. It is very much expected that the center has decided to name RBI as the regulator and Enforcement Directorate as the investigating authority for offenses under the cryptocurrency bill.
The book Payment and Settlement Systems in India mentioned that “Private digital currencies (PDCs)/virtual currencies (VCs)/cryptocurrencies (CCs) have gained popularity in recent years. In India, the regulators and governments have been skeptical about these currencies and are apprehensive about the associated risks,”. It also added, “Nevertheless, the RBI is exploring the possibility as to whether there is a need for a digital version of fiat currency and in case there is, then how to operationalize it,”.
It’s better to take your money out of private cryptocurrency and invest smartly in other firms. I hope you enjoyed reading this. Thank you!