- India to join China in setting strict rules for cryptocurrencies in the country.
- Citizens of India are only allowed to hold government approved cryptocurrencies.
- Government to ensure citizens are not evading tax by holding unregulated cryptocurrencies.
The holding of unregulated cryptocurrency asset in India could attract punishment. This was revealed by a local news outlet, which is likely a feature in the awaiting RBI and Subhash Garg-panel report on digital currencies.
Speculations Of Cryptocurrency Ban In India Rages
One of the most trusted financial news sites in India, Moneycontrol, reported on the 15th of October that the long awaiting report of the RBI and Subhash Garg-panel on digital currencies might contain a provision that makes holding an unregulated crypto asset in the country punishable by law.
The website noted that “India may look at amending existing laws that could make the holding of crypto assets, other than those not approved by the government, a punishable offense.”
Also, it was reported that the government was of the view that unregulated crypto assets should not be allowed to move into the financial system.
The RBI and Subhash Garg-panel was set up in December last year to look into a framework for regulating cryptocurrencies in the country. The panel is also inclusive of Securities and Exchange Board of India chairman, Ajay Tyagi, and Reserve Bank of India (RBI) deputy governor, BP Kanungo.
The panel is in the last stage of its deliberations, and the report of the panel is expected to be received in December, which may contain the view of the government that unregulated crypto assets should not be allowed to move into the financial system.
The government and the RBI’s biggest concern is to ensure that unregulated crypto assets are not used as a means of a transaction to evade tax and strike deals outside the jurisdiction, inclusive of multi-level marketing (MLM) and Ponzi schemes, as reported by the website.
Democratic Setting Of India and Stipulating Of Such Law
India operates a democratic system of governance, and for a law that outlaws the holding of unregulated cryptocurrency to be stipulated, it will undergo many stages and discussion with the public before such law could find its bearing.
The country that still holds the harshest stance against cryptocurrency at the moment in the world is China, which has closed bank account associated with cryptocurrency and also banned cryptocurrency related activities while embracing blockchain technology.
A similar stance to China might be in the offering in India. However, the implementation is set to face some level of resistance considering wide acceptance and use of cryptocurrencies in India.