An anonymous senior official from the Indian government said that the country could soon pass a law banning not only the circulation, but the storage and transfer of cryptocurrencies. A senior Indian official told Reuters that a bill to completely ban cryptocurrencies in the country is likely to be passed shortly by the government of Prime Minister Narendra Modi, which controls the majority of votes in parliament.
The bill criminalizes the possession, release, mining, trading and transfer of cryptoassets.
This initiative is in line with the February agenda of the Indian government, which called for a ban on “private” cryptocurrencies in order to create an enabling environment for the issuance of India’s state-owned cryptocurrency. However, recent comments from the authorities have raised hopes among investors that the government will not impede the development of the cryptocurrency market.
According to the bill, cryptocurrency owners will have up to six months to liquidate their assets, after which fines will be levied.
If approved, the bill will make India the first major economy to make crypto holding illegal. Even in China, where ICOs and cryptocurrency exchanges have been banned since 2017, digital currency ownership is not punished.
According to industry experts, despite government dissatisfaction, the volume of cryptocurrency transactions in India is growing, and already 8 million investors own crypto assets worth 100 billion rupees ($ 1.4 billion).
Cryptocurrency investor Sumnesh Salodkar said: “Money is multiplying rapidly every month and no one wants to be left out. Despite the fact that people panic about a potential ban, their choice is influenced by the desire to make money. ”
According to Gaurav Dahake, CEO of cryptocurrency exchange Bitbns, the number of user registrations and the flow of money on the exchange have increased 30 times compared to last year. The number of users of Unocoin, one of India’s oldest exchanges, grew by 20,000 in January and February, despite concerns about a ban.
A senior official said the plan is to ban “private” crypto assets while promoting the blockchain, which could revolutionize international transactions.
“We have nothing against technology. There will be no harm using this technology, ”the official said, adding that the government’s actions would be“ calibrated ”in terms of fines for those who did not liquidate crypto assets during the grace period set by the law.
India’s government commission in 2019 recommended up to 10 years’ imprisonment for people who mine, store, sell, transfer, issue or trade cryptocurrencies. The official declined to say whether the new bill includes prison terms as well as fines, but said discussions on the bill were in their final stages.
In March 2020, India’s Supreme Court overturned the country’s Central Bank (RBI) directive that prohibited the use of Bitcoin and other cryptocurrencies in India, prompting investors to enter the market. The court ordered the government to develop a law to regulate cryptocurrencies in the country.
