New Delhi: With the central government seeking to ban all private cryptocurrencies in the upcoming Crypto Bill 2021, experts and major industry players said on Wednesday that the provisions relating to “banning” private cryptocurrencies have to be looked at very carefully.
The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 seeks to ban all private cryptocurrencies in India in the winter session of Parliament beginning November 29.
However, it allows some exceptions to promote the underlying technology of cryptocurrencies and its use.
Former Finance Secretary Subhash Chandra Garg told IANS that cryptocurrencies do not work and only provide services in the form of currencies.
“When you ‘ban’ cryptocurrencies what exactly do you ban? Similarly, what are the permissible exemptions? Do you allow cryptocurrencies to be the biggest discount issue in platform payments? How do you allow the purchase of exempt cryptocurrencies for exempt use by sovereign currencies?” He asked.
The biggest thing the proposed bill needs to look at is how to allow crypto platforms to produce goods, services and assets using the versatile technology of blockchain and cryptography, when it is used as a currency-asset. Vishal Garg led the way. The Inter-Ministerial Committee (IMC) that drafted the cryptocurrency bill.
According to BuyUcoin CEO Shivam Thakral, the crypto bill should be flexible enough for young blockchain projects to flourish.
“We also urge the government to provide immediate clarity on the taxation and filing of crypto assets,” he added.
Prime Minister Narendra Modi had earlier said that all democratic countries need to work together on cryptocurrency and ensure that it does not fall into the wrong hands.
Giving the example of virtual currency, he said: “Take cryptocurrency or bitcoin for example. It is important that all countries work together on this and ensure that it does not fall into the wrong hands, which can spoil our youth.” “
Several high-profile meetings have been held in recent days to discuss the regulation of cryptocurrencies. The Parliamentary Standing Committee had also sought regulation on cryptocurrency and its ecosystem.
Another objective of the crypto bill is to “create a facilitating framework for the creation of an official digital currency to be issued by the Reserve Bank of India”.
Garg said the move to create a legal framework for issuance of digital currency is welcome.
“I hope the bill does not limit RBI’s preference for digital rupee technology. A dematerialized rupee is a better option than a rupee built on a blockchain crypto technology platform,” he told IANS.
New Delhi-based cyber law expert Virag Gupta said the delay in bringing in the law has given some exchanges an opportunity to build a parallel empire of cryptocurrency.
“Deregulation of cryptocurrencies is posing a huge risk to national security and individual investors in India. The bill should give legal protection to blockchain technology and the country’s official digital currency,” he told IANS.
Apart from making laws on crypto, the government should also make necessary provisions in the Banking Regulation Act, 1949, the RBI Act, 1934 and the Payment and Settlement Systems Act, 2007 to “ensure proper security and least judicial intervention in crypto matters”. . Gupta added.
Garg said that the crypto bill should ensure that it does not kill off new innovations around blockchain, and create an ecosystem that truly promotes the technology.
According to Unocoin’s founder and CEO, Satwik Viswanath, the crypto industry needs to wait and watch until the bill is introduced in Parliament, as it is “too immature to try to decode what is coming right now”.
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