The much-awaited cryptocurrency bill in India is set to be tabled during the upcoming winter session of the parliament and it has already created a lot of FUD as the first snapshot of the bill went public. The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 is among the 26 bills scheduled to get listed for the upcoming winter session starting on 29 November.
The main controversy seems to be with the wording of the bill, the content seems quite similar to the one created in February.
The Indian government had a drastic change of stance towards regulating crypto-assets over the past 1o month as they assured they would treat cryptocurrencies as an asset class rather than imposing a blanket ban. However, the wordings of the tabled bill seeks to make way for soverign national digital currency and ban the use of “Private” cryptocurrencies, barring a few. The main controversy seems to be around the word “private” as anything which is not issued by the government will fall into that category.
The wordings of the bill seems to be the main point of conflict here as it contradicts recent insider reports about the government considering regulating crypto as an asset while prohibiting its use as a form of payment. The majority of mainstream media are back at fearmongering claiming a blanket ban is on the cards.
Crypto investors in India need to understand that the Bill once tabled would be up for discussion and experts can still amend it. Even if a flawed bill is made into law, it could be amended over time looking at the progress around the world. Also, it is near impossible to put a blanket ban on crypto use, take China, for example. This year was their 13th crypto ban announcement and yet Chinese traders find a way to bypass the regulations. India central bank RBI imposed a banking ban in 2017 as well, but it was later overturned by the Supreme court.
“Not a Ban,” Says Security Expert
Security experts in the industry weighed in on the controversy and assured that it won’t be an outright ban rather the reservation against private cryptocurrencies is to avoid the use of digital assets in terror funding and other criminal activities.
“A regulation mechanism will be in place so that crypto is not misused. The government is concerned about the underground transactions happening against cryptocurrency — particularly its role in ‘hawala’ and terror funding,”
The bill also talks about a few exceptions and experts believe Bitcoin, Ethereum, and a few other popular crypto assets could make it to the list.