Indian Government Reconsiders Banning Cryptocurrencies

Indian Government Reconsiders Banning Cryptocurrencies

The Indian government is reportedly rethinking banning crypto use in its jurisdiction and is now considering a more lenient regulatory approach. According to inside information, the government has created a new panel of experts to develop a regulatory framework for cryptocurrency use.

The Asian giant has remained indecisive in its efforts regarding cryptocurrency for several years. In 2018, the Reserve Bank of India instructed all its affiliated companies to desist from operating with digital assets. However, only after two years, the Supreme Court of India reversed the ban.

Despite the immense interest in cryptos by its citizens, Indian authorities continue to oppose its growth in the country. The government announced in March that it would criminalize cryptocurrency transactions in the country.

According to The Economic Times, the country has shifted its anti-crypto stance and is considering regulatory measures instead. Referring to three inside sources, the report noted that the authorities “may form a fresh panel of experts to study the possibility of regulating cryptocurrency in India” instead of an outright ban.

The new push will address previous recommendations made by former Finance Secretary Subhash Garg in 2019. The new committee argued that the older rules are outdated.

Indian Government to Also Develop CBDC

An insider familiar with the new development told The Economic Times that:

“There is a view within the government that the recommendations made by Subhash Garg are dated, and a fresh look is needed at [the] use of cryptos rather than a total ban.”

The insiders asserted that the recent surge in trading volume by local traders prompted the finance ministry to shift its recent stance.

Additionally, the committee will utilize blockchain for “technological enhancement” and develop new ways to regulate cryptocurrency as digital assets instead of currencies.

Meanwhile, the committee’s objective includes working with the central bank on developing and releasing a digital rupee (CBDC).

 

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