Local media reports that the Indian government won’t seek a ban on crypto, but will regulate it.
Cointelegraph reported on Nov. 23 that the Indian government was looking at a bill to create a digital currency and ban all private cryptocurrencies.
This news caused panic selling on WazirX, a local cryptocurrency exchange. Many observers are divided about the future prospects of crypto in India due to the vague language in the bill and lack thereof.
Indian news channel NDTV reported Dec. 2 that details of a cabinet document circulating in the government about the proposed crypto bill were obtained.
Sunil Prabhu, NDTV’s reporter, stated that the note included suggestions for regulating cryptocurrencies as crypto assets. The Securities and Exchange Board of India oversees the regulation of local crypto-exchanges.
Prabhu stated that investors will have a time limit to declare crypto holdings and must then transfer them to SEBI-regulated exchanges. This suggests that private wallets could be banned. Prabhu said that this was part of the government’s push to stop money laundering and terrorist financing.
Prabhu stated that the government would suspend its plans to create a central digital currency (CBDC), with the Reserve Bank of India (RBI), while it focuses exclusively on the crypto sector. It won’t allow crypto assets to be recognised as legal tender or currencies, which suggests that it intends to make a clear distinction.
“Cryptocurrency will not be accepted as a legal tender. This is a no. That is the clear no.
He said that he believes they will make it (CBDC) as a standalone virtual money for the RBI at some point in the future. However, it will happen at a different time.
Related: WazirX and Presearch rally after data shows an increase in user activity
Some Indian crypto investors have welcomed the reports from NDTV. Redditor “ultron290196”, posted in the r/cryptocurrency forum, expressing relief at not having to worry about an actual ban.
“It seems that our Indian crypto movement has been noticed by the government. They’re now deciding to regulate Cryptocurrency and Crypto “Assets”, and not recognize it as legal tender. […] It’s a relief for all Indians. They said, “I’d rather pay some taxes than become an outcast.”
Some people were not as happy with the details of “No-Incident-87118”, writing “here’s what the catch.” You can only use exchange wallets and no hard wallets. You can only use Indian exchanges.