The Indian government is reportedly trying to “fast track” a modified cryptocurrency bill to be introduced in the winter session of parliament. India’s crypto legislation is expected to take a “middle path” approach to balance all stakeholders’ concerns.
India is currently working on cryptocurrency regulation. The government is now considering taking a “middle path” that balances all stakeholders’ concerns to regulate cryptocurrencies, the Economic Times reported Monday, citing an unnamed government source.
An outright ban on cryptocurrencies is not seen as feasible given a large number of Indians are investing in crypto assets, the person explained, adding that making cryptocurrencies legal tender, as El Salvador did, is not an option either. The source said:
A balance has to be found … A middle path that balances the concerns of all stakeholders is more likely.
Policymakers were recently given a presentation, including by the finance ministry, on cryptocurrency, the publication conveyed. It covered the pros and cons of cryptocurrencies, regulation by other countries, crypto investments by Indians, and the view of the central bank, the Reserve Bank of India (RBI), on crypto. India’s central bank has repeatedly said that it has “serious concerns” about crypto which have been communicated to the government.
Another presentation will likely be made on cryptocurrency taxation, the source said, noting that the crypto legislation will go to the Cabinet after legal vetting, which is expected to be in the upcoming winter session of parliament. The winter session starts on Nov. 29.
In addition, CNBC-TV18 reported Monday that the Indian government is working on modifying a proposed cryptocurrency bill. The publication also cited unnamed sources who said the bill is likely to be introduced at the start of the winter session of parliament.
In June 2019, the Indian Ministry of Finance published a draft cryptocurrency bill titled “Banning of Cryptocurrency and Regulation of Official Digital Currency Bill.” It recommends banning all cryptocurrencies except state-issued ones. In January this year, a similarly titled bill was listed for consideration in Lok Sabha, the lower house of India’s parliament. However, it was not introduced. Since then, several reports suggest that the government is planning to regulate crypto as an asset class in India instead of banning it. In September, the chairman of India’s Parliamentary Standing Committee on Finance explained that cryptocurrency legislation in India will be “distinct and unique.”
The news outlet further noted Monday that finance ministry officials are trying to “fast track” a modified cryptocurrency bill.
Meanwhile, the RBI is also working on a central bank digital currency (CBDC), planning to unveil a digital rupee model by year-end. The state-backed digital currency is expected to be launched in phases.
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