Two high-level meetings regarding Cryptocurrency regulation in India have been held in the last week. First, prime minister Narendra Modi chaired a meeting where he talked about the negative impact of unnecessary Cryptocurrencies as well as terror financing and money laundering. After that, the parliamentary experts along with industry experts find a future path for Cryptocurrencies in India.
Keep in mind, both ideas suggest that instead of banning Cryptocurrencies, India should regulate them. It means the Indian Govt will allow a few things and restrict some things regarding Cryptocurrency.
Regulatory Developments in India:
Let’s have a look at the Cryptocurrency Regulatory in India, one by one:
- 24 December 2013– Reserve Bank of India informs users about the risks of Cryptocurrency as the price will vary over time which will not be considered as an asset.
- 26 August 2015– The former deputy governor of RBI, R Gandhi said that Cryptocurrency can support criminals in money laundering, and tax evasion.
- 1 February 2017– RBI again expresses concern about the negative impact of Cryptocurrency in India.
- 27 February 2017– Crypto-firms build Digital Assets as well as the Blockchain Foundation of India.
- 12 April 2017– Govt of India established an Inter-Disciplinary Committee in order to analyze Cryptocurrencies and the growth of virtual currencies in India.
- 7 August 2017– A report was submitted by the Inter-Disciplinary Committee. However, it was not made public.
- 5 December 2017- Reserve Bank of India publishes 3rd advisory in order to concern users about the risks of Cryptocurrency.
- 29 December 2017– Finance Ministry of India cautions people that not to invest in Cryptocurrency as these are not legal.
- 1 February 2018– Arun Jaitely, the former Finance Minister says that Cryptocurrency will not be considered as a part of the payment system as these can be used for illegitimate activities.
- 5 April 2018– Reserve Bank of India announced that they will prohibit their banking to deal with Cryptocurrency.
- 23 April 2018– Delhi High Court grants an appeal questioning the RBI’s issues and circular notice to the central bank. Later the Finance Ministry involves in the matter.
- 5 July 2018– The Supreme Court refused to grant relief on the RBI announcement that stopped all regulated entities from dealing with Cryptocurrencies.
- 4 March 2020– The Supreme Court overturned the Reserve Bank of India’s 2018 announcement on the ground of proportionality.
- 30 January 2021– Indian Govt announced The Cryptocurrency and Regulation of Official Digital Currency Bill during the Budget Session of Parliament in 2021.
After introducing the bill, there have been lots of regulatory developments in Cryptocurrency. Such as:
- 9 February 2021– Govt announces that India will soon ban Cryptocurrency.
- 16 February 2021– IAMAI questioning about Govt’s announcement.
- 22 February 2021- Securities and Exchange Board of India ask promoters to square the Cryptocurrency before launching a public offer.
- 8 March 2021– Finance Minister says that the Indian Govt will adopt a Calibrated Approach for Cryptocurrency regulation.
- 11 March 2021– IAMAI publishes a notice about the negative effects of the Cryptocurrency ban in India.
- 23 March 2021– Nandan Nilekani says that the Indian Govt must treat Cryptocurrency as the asset class.
- 4 May 2021– Private banks shutting payment channels for crypto-exchange
- 16-18 May 2021– Crypto-exchange faces many payment and bank issues and as a result investors stop investing in Cryptocurrency.
What can be Allowed after the Cryptocurrency Regulation in India?
After the announcement of The Cryptocurrency and Regulation of Official Digital Currency Bill, these things are allowed in India.
- By following certain guidelines, investors can buy and sell Cryptocurrencies from the exchange platform.
- India’s planning towards Cryptocurrency seems protective. The primary objective of introducing the Bill is to ensure that investors’ money will be protected. As a result, now anybody can invest in Cryptocurrency without worries.
- The new bill clarifies how the Indian Govt plans to tax Cryptocurrency. A recent report shows that the Govt is planning to earn revenue from Cryptocurrency.
What may not be Allowed after the Cryptocurrency Regulation in India?
Keep in mind, the Cryptocurrency and Regulation of Official Digital Currency Bill contain certain restrictions in Cryptocurrency.
- Now, it will be difficult for people to create Cryptocurrency. In the past, if you have a strong internet connection, you can quickly create Cryptocurrency. However, after the announcement of the Bill, those who fulfill the required criteria can only create Cryptocurrency.
- Still, Cryptocurrency isn’t legal tender. In the early days, many people start believing that Cryptocurrency will be a strong replacement for rupees. However, the Bill clarifies that it was a myth. In other words, you can’t use Bitcoin to buy food.
[ Note- The Reserve Bank of India announced that they will introduce their own Cryptocurrency soon. However, RBI has not published any advertisement regarding this.]
That’s it. We hope now it’s clear to you what Cryptocurrency is and its regulation in India. It’s up to you whether to invest in Cryptocurrency or not. If you want to know more information related to Cryptocurrency, visit Non Stop Article and then decide whether Cryptocurrency is good for you or not.