Indian Authorities Pass Note That Might Ban Cryptocurrency
According to reports by Economic Times, India authorities are currently making moves to ban crypto-related activities across the country. Government officials say that they are willing to go for a legal framework rather than hold on to the memo drafted by the Reserve Bank of India. “A note has been moved (by the finance ministry) for inter-ministerial consultations,” a senior government official told ET. This is coming after the Supreme Court gave the RBI the go-ahead to send out a memo to all banks to start working with crypto investments across the country.
The note is still awaiting deliberation
The note is said to be on its way to the cabinet and after deliberations and consultations, it will then be sent to the parliament. If the ruling should go the way the previous proposal went, then it would be a huge blow to investors and traders of virtual assets in the country including Bitcoin. A panel in the government prepared a proposal late July 2019 which would ban all crypto-related activities in the country with a fine of 10 years imprisonment or an Rs. 25 crores fine.
When the Supreme Court gave the RBI the okay to release the memo, it said, “While we have recognized… the power of RBI to take preemptive action, we are testing in this part of the order the proportionality of such measure, for the determination of which RBI needs to show at least some semblance of any damage suffered by its regulated entities. But there is none.” The ruling by the Supreme Court lifted the previous ban on crypto and said that banks could work with crypto investments in the country. This new development promoted new startups and investments in the crypto field across the country.
Expert says that If crypto is banned in India , the economy might suffer
However, after the rule by the Supreme Court, banks are still adamant that they don’t want to work with crypto investments in the country which made most crypto firms seek banking services outside the Asian country. Crypto trader and investor Amit Maheshwari said the previous rule was harsh and would mean that “illegal to hold, sell, issue, transfer, mine or use cryptocurrencies and, if passed in the current form, would completely decimate the crypto-industry in India”. He said he hopes the government would make the right consultations and stop this rule in its track before the economy crumbles.
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