There are few countries where trading bitcoin and other cryptocurrencies are illegal, and India is one of them. It now looks like the emerging digital currencies are moving towards a complete ban in the country because a committee formed by the Indian Government has developed a bill named as “Banning of Cryptocurrencies and Regulation of Official Digital Currencies Bill 2019”. The drafted bill aims at imposing a ban on transactions related to digital currencies throughout the country.
If this bill is passed by the Indian Government, then it will allow for an immediate ban on Bitcoin and other cryptocurrencies. However, the committee is discussing and taking opinion from various Government portfolios over the proposed draft bill. Meanwhile, the Indian Lawmakers don’t have a positive outlook towards cryptocurrencies, they have an unfriendly and aggressive view towards the digital currencies and also recommends to immediately ban cryptocurrencies.
According to the Economic Times report published on April 25th 2019, the draft bill related to complete ban has been circulated within various government departments of India and is even distributed to local media outlets.
The concept of imposing a ban on cryptocurrencies was initiated by the committee. The committee included members from the Department of Economic Affairs (DEA), Investor Education and Protection Fund Authority (IEPFA), the Central Board of Direct Taxes (CBDT) and the Central Board of Indirect Taxes and Customs (CBIC) and from other Indian departments too. They all have supported the concept of banning digital currencies and even encouraged to completely ban the “sale purchase and issuance of all types of cryptocurrency.”
The committee has claimed that the complete ban on cryptocurrencies is in the best interest of the country and is even considering of an option to include it within the Prevention of Money Laundering Act (PMLA) because cryptocurrencies might be used for money laundering.
The Ministry of Corporate Affairs stated that there are illegal activities and projects that are carried out by using cryptocurrencies to “defraud gullible investors.”
Governments Internal sources say that inter-minister level discussion has started on the draft bill and the bill is currently been reviewed by other senior-level ministers.
A year back, the central bank of India, RBI had restricted banks not to offer services to any organization that is dealing with digital currencies. However, the case against implementing ban was put on hold by the Apex court and recommended the Government to first create a law on digital currencies and gave a timeframe of four weeks to the government to form cryptocurrency laws.
The drafting of the bill started in 2018 onwards; members from different government departments within Finance Secretary, Shubash Chandra Garg were involved.
However, most people believe that cryptocurrencies cannot be entirely banned in India. The Indian Government needs to deeply examine the case before taking a huge step.
According to Economic Times reports, the December report is completely opposite to the recent one, which says that the Indian Lawmakers recommended making cryptocurrencies legal in India. It also pointed out there is a general agreement that states digital currencies cannot be completely banned.
The Apex court had even directed the government to temporary ban cryptocurrencies under the Anti-Money Laundering Act (PMLA). The new government which was formed in May 2019, will vote on the cryptocurrency bill.