Bill To Ban Private Cryptocurrencies To Come Up In Winter Session

A Bill to prohibit all private cryptocurrencies in India with certain exceptions is expected to be taken up for final consideration and passing during the Winter Session starting on November 29, 2021. The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, is among 26 new Bills of a total of 29 Bills in the government's legislative agenda. The government's objective is, "To create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India."

The Bill also seeks to prohibit all private cryptocurrencies in India; however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses.

This comes a week after the first-ever Parliamentary panel discussion on the broad contours of crypto finance, where a consensus was reached that cryptocurrency can't be stopped but must be regulated.

The standing committee on finance meeting was chaired by BJP's Jayant Sinha, who met representatives of crypto exchanges, Blockchain and Crypto Assets Council (BACC), industry bodies, and other stakeholders on November 16.

Security of investors' money and misleading advertisements in the media regarding investment potential and risks have long been a cause of concern. The government has held several meetings with all stakeholders to discuss the regulation of digital currencies. Prime Minister Narendra Modi has also chaired a high-level meeting with officials from various ministries and RBI on the issue.

The Reserve Bank of India and Securities and Exchange Board of India have voiced concerns about the unregulated growth of cryptocurrencies in India, keeping vulnerable retail investors in mind. 

"On crypto...we have serious concerns from the point of view of macroeconomic and financial stability. How the issue has to be dealt with - we have given our detailed suggestions to the government; as far as I know, the matter is under the active consideration of the government, and the government will decide," RBI Governor Shaktikanta Das had said at a media event.