According to people familiar with the matter, India is considering a proposal to treat cryptocurrencies as financial assets while protecting small investors.
Discussions will take place as authorities compete to finalize the bill that the Center wants to submit to Congress in a session beginning November 29. People have asked that while banning fiat currency use, the law may set a minimum investment in digital currencies. Identified as no final decision has been made.
When policymakers posted a description of the bill on Congress’s website late Tuesday, the bill was all private cryptocurrencies with the exception of “specific exceptions to promoting cryptocurrencies and the technologies underlying their use.” I said I was trying to ban it, leaving room for a bit of shaking.
Uncertainty caused cryptocurrencies, including Shiba Inu and Dogecoin, to sell out on Wednesday. These temporarily fell by more than 20% on trading on the WazirX platform, one of India’s major crypto exchanges. The impact on trading platforms such as Binance and Kraken was much less.
A Treasury spokesman was not immediately asked for comment.
The Reserve Bank of India (RBI) wants a complete ban on digital currencies as it feels that the central bank could impact the country’s macroeconomic and financial stability. The government is considering taxing profits from cryptocurrencies in its next budget, but RBI Governor Shaktikanta Das said last week that more in-depth discussions were needed on the issue.
People said the Prime Minister’s Office is actively considering the issue and will be brought to the Cabinet for approval once the bill is finalized.
Earlier this month, Prime Minister Modi held a conference on cryptocurrencies. Authorities then said they would not allow India to use the unregulated crypto market as a means of money laundering and terrorist financing. Then, in a speech last week, he urged democracies to cooperate in regulating failed private cryptocurrencies that could land on the “wrong hand.”