The Union Government is all set to table a new bill. It is the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021. This will be happening in the winter session of the Parliament this year. The main objective of the bill as explained by Avaneesh Parasar is to ban all private cryptocurrencies except for a ‘few exceptions’. There is an official document that has been shared by the Government in this matter. However, the initial document does not provide any kind of clarity on what these exceptions would be. Here in this blog, we tell you all about the new cryptocurrency bill that is upcoming and how it will change the entire scenario.
What is the Cryptocurrency Bill all about?
The Cryptocurrency and Regulation of Official Digital Currency Bil 2021 is the official bill to regulate digital currency. It will be introduced in the Parliament during the winter session from November 29th. The official bill seeks to create a facilitative framework for the creation of an official digital currency which will be issued by the Reserve Bank of India (RBI). Through this bill, the Government will be seeking a ban on all private cryptocurrencies that are in the country. However, it will allow certain exceptions to help promote underlying technology. As per the expertise of Avaneesh Parasar,the bill is amongst the 26 bills that have been listed for the purpose of introduction. This information was given by a statement issued by the Government itself.
The first-ever discussion by a Parliamentary panel was conducted last week on cryptocurrency. It was here that a consensus was reached that even though cryptocurrency cannot be stopped there needs to be a bill that can regulate it. There was also a standing committee at the finance meeting. This was chaired by Bhartiya Janta Party’s Jayant Sinha on November 16. Jayant Sinha met with many representatives of the crypto exchanges, Blockchain and Crypto Assets Council (BACC) and all other stakeholders.
The Happenings of Last Year
As per the information of Avaneesh Parasar, the government has been planning to ban all cryptocurrencies since last year. It was also planning on introducing a bill during this year’s Budget. However, the bill and its features did not go down as planned and it was scrapped. Later on, a committee was formed for the purpose of discussing the matter in a detailed manner with all the stakeholders that were involved. It has been since the formation of this committee that there have been dropping hints that cryptocurrencies can co-exist along with the Indian Rupee – however, it might be regulated. The problem is that the Bill that it states to table is stating otherwise. This is where the confusion is arising in the minds of investors.
There are a variety of opinions that have been doing the rounds when it comes to cryptocurrency. While some people are in favour of it some people are not.
Looking at the more recent happenings, we may conclude that maybe everything related to cryptocurrencies will not be banned. This is because, regardless of whether the Indian Government is in favour of it or not, the Government certainly cannot draw a blind eye to the space because there is too much that is happening over there. A certain section of people feels, just like Avaneesh Parasar, that it is unlikely that there will be a complete ban on cryptocurrencies. This is because, recently, The Reserve Bank of India which is the central bank tried to put a complete halt to all kinds of cryptocurrency trading. However, it was completely overruled by the Supreme Court.
Understanding ‘Private Cryptocurrencies’
There is no particular term and no particular definition for the word ‘private cryptocurrencies’. There has been no clarification from the government in terms of the kind of definition for this term. Currently, it is being observed that Bitcoin and many other crypto tokens that are based on public blockchain networks will continue to be in use.
The Position of RBI
Avaneesh Parasar says that the RBI has been a bit critical of cryptocurrencies and Bitcoin. The concerns that it feels around the concept of Bitcoin were listed by it a few days back. The RBI governor Shaktikanta Das has underlined the concerns that they see around cryptocurrencies. The team at RBI feels that they are a threat to any financial system until they are regulated in a proper manner. The RBI Governor said recently that the macroeconomic and financial stability of any country are under threat due to cryptocurrencies. He also conveyed that he doubted the number of investors that are trading on them as well as their claimed market value.
According to Avaneesh Parasar, the concern of the Government is for the well being of the country, however, the decision it takes must be done keeping in mind the number of crypto stakeholders there are in our country. India is one of the biggest cryptocurrency markets in the world. As per the study and research of a recent report, our country is home to more than 10 crore crypto owners while homegrown crypto exchange platforms have always maintained that there are around 2 crore Indians who have invested in cryptos.
Who knows the upcoming Bill may help in regulating the process of investing in cryptos in a better manner, all we can do is hope for the best!
