The Indian Authorities have always been unclear about their stand on cryptocurrencies. However, they are actively adopting an opposing stand since the last couple of years.
It began with the banning of banking services to businesses and entities engaging in Virtual Currency transactions in June 2018. Nevertheless, P2P exchange platforms still flourish as crypto enthusiast continue to trade ethically in cryptocurrencies.
However, Koinex, one of the largest peer-to-peer platform in India announced its closure due to extreme scrutiny and hindrances caused by the policing authorities.
Draft Bill Shared By Blockchain Lawyer
Moreover, a report which came out in June 2019 regarding the draft cryptocurrency bill which seeks a ban on cryptocurrency transactions, ethical or unethical. While the authorities have made no confirmations or official statement, Varun Sethi, Indian Tech Lawyer and a crypto-enthusiast, has shared the alleged draft bill. He tweeted,
The complete draft of the ALLEGED
#Banning of #CryptoCurrency and Regulation of Official #Digital Currency #Bill 2019 #India
Coincidently, the contents of the draft bill leaked are in agreement with the previous reports which provides more authenticity to the document. Hence, the doubts around it seem to be diminishing by each revelation.
According to the leaked document, India does seek ban storage and usage of cryptocurrencies.
No person shall mine, generate, hold, sell, deal in, issue, transfer, dispose of or use cryptocurrency in the territory of India.
The drafting committee has also proposed fine and punishment for people engaging in crypto activities. The penalty will be decided by the Governments and can be up to three times the value of profit or loss generated. Moreover, imprisonment from one to ten years can also be expected.
Reportedly, there are more than 5 million cryptocurrency enthusiasts in the country. Moreover, India will be the first country to conduct crack-downs on such a large scale with such strictness. China, US, Japan, and countries in Europe have sought to deter the unethical activities, but a broad scale ban seems improbable at the moment.
Nevertheless, the blockchain application and distributed ledger technologies will still be viable in the country. The bill also proposed that the Central Government, with approval from the Central Bank in India, will seek to approve the “digital rupee.”
The nature and design of the digital sovereign currency were not explicit. However, the application of blockchain can be expected with the currency being backed by the Central Bank Reserves.
Some of the blockchain and cryptocurrency leaders in the country have started a campaign to seek appropriate representation and presentation of reasoning before the Central Government or the drafting committee.
Nishal Shetty, the CEO, and founder of WazirX, and the forerunner of the online campaign tweeted,
The objective of this campaign is to be heard by our law makers. India needs to be at the forefront of the crypto revolution and by being vocal about it, you and I can make that happen. If we do not speak, they will never know.
Moreover, he also spoke about the authenticity of the leaked draft bill. According to him, the bill will probably come out with a lot of changes and will public comments before becoming a law. However, he also reiterated a joint effort by the community in engaging with the authorities is paramount at this point.
Do you think that an outright ban on cryptocurrency is the solution or it will create more problems? Please share your views with us.
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Nivesh from Engineering Background is a full-time Crypto Journalist at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com