In the winter session of Parliament, the Centre is likely to introduce a Bill to ban all cryptocurrencies in India, with a few exceptions, and create a regulatory framework to regulate digital currency issued by the Reserve Bank of India (RBI). It is likely that In the winter session of Parliament, the Centre will introduce a Bill to ban all cryptocurrencies in India, with a few exceptions, and create a regulatory framework to regulate digital currency issued by the Reserve Bank of India (RBI).
The Ministry of Finance is said to have released a draft paper that explaining that there is a real and heightened risk of investment bubble of the type seen in Ponzi schemes which can lead to sudden and prolonged crash exposing investors, especially retail consumers losing their hard-earned money.
This plan has been met with mixed responses from different politicians. Some have welcomed this move while some have opposed it. It is still unclear whether this ban will take place or not, but the Centre has taken its first step.
All major digital currencies saw their prices drop by around 15 percent and more, with Bitcoin falling by around 18.53 percent, Ethereum by 15.58 percent, and Tether by 18.29 percent.
Here’s Your 10-Point Cheatsheet To This Big Story:
- During the winter session beginning November 29, the Lok Sabha is scheduled to introduce the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021.
- The Bill seeks to establish a facilitative framework to facilitate the creation of the official digital currency to be issued by the Reserve Bank of India. It also seeks to prohibit all private cryptocurrencies in India, although it allows certain exceptions for promoting the underlying technology of cryptocurrencies
- Reserve Bank officials have raised concerns about private cryptocurrencies. Bitcoin, the world’s largest cryptocurrencies, is hovering around $65,000. Since the beginning of the year, the price has more than doubled.
- Industry estimates place the number of crypto investors in India between 15 million and 20 million, with total crypto assets worth around $ 5.39 billion.
- In recent times, there have been a growing number of advertisements encouraging investors to invest in cryptocurrencies with high returns, amid concerns that such currencies are being used to lure investors with misleading claims.
- According to the BJP member Jayant Sinha, the Standing Committee on Finance met with representatives of crypto exchanges, blockchain technology, and the Crypto Assets Council (BACC) last week and came to the conclusion that cryptocurrencies should not be banned, but regulated.
- Over the past decade or so, private digital currencies have become increasingly popular. However, regulators and governments have been reluctant to accept these currencies due to the associated risks.
- The Supreme Court ruled on March 4, 2021, that an RBI circular enacted on April 6, 2018, prohibiting banks and entities regulated by it from providing services related to virtual currencies, was unconstitutional.
- On November 18, Prime Minister Narendra Modi stressed the importance of ensuring that cryptocurrency does not “end up in the wrong hands” in a keynote address at the Sydney Dialogue.
- Cryptocurrency is currently only legal tender in El Salvador.
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Author
Chris Munch is a professional cryptocurrency and blockchain writer with a background in software businesses, and has been involved in marketing within the cryptocurrency space. With a passion for innovation, Chris brings a unique and insightful perspective to the world of crypto and blockchain. Chris has a deep understanding of the economic, psychological, marketing and financial forces that drive the crypto market, and has made a number of accurate calls of major shifts in market trends. He is constantly researching and studying the latest trends and technologies, ensuring that he is always up-to-date on the latest developments in the industry. Chris’ writing is characterized by his ability to explain complex concepts in a clear and concise manner, making it accessible to a wide audience of readers.
