Internal source confirms imminent general ban on cryptocurrencies

India: Internal source confirms imminent general ban on cryptocurrencies

A bill already entered in the Indian parliament is apparently aimed at a general ban on cryptocurrencies.

An anonymous source from India’s finance ministry confirms that cryptocurrencies will soon be banned outright in the world’s second most populous country.

The inside source told Bloomberg that the use of cryptocurrencies Bitcoin Bank software in any form will be banned. A corresponding bill is to be debated in parliament soon. Trading cryptocurrencies via foreign crypto exchanges would also no longer be allowed in the future.

Crypto investors are to be granted a transitional period of three to six months as soon as the planned law comes into force, in order to be able to liquidate their crypto assets.

Digital Currencies was already entered

As the supposed source from the Ministry of Finance explains, the Indian government’s negative stance stems from the fact that the country’s central bank, the Reserve Bank of India (RBI), condemns cryptocurrencies.

In January, a draft on the „Regulation of Cryptocurrencies and Digital Currencies“ was already entered in the Indian parliament, which is on the agenda for the next few weeks.

This will most likely be the bill discussed, as the subject of the draft is to create a legal framework for the RBI’s central bank digital currency, while at the same time „banning all private cryptocurrencies in India“.

Sathvik Vishwanath, co-founder and managing director of Unocoin, a major Indian crypto exchange, tells Bloomberg that the domestic crypto industry is „eager for more details to follow“:

„If the government does indeed ban all cryptocurrencies except their own, then it no longer makes sense for us to do our business in India. But for now, it is a case of wait and see.“

The Supreme Court of India had in turn in March 2020 struck down a previous RBI order that had banned Indian financial institutions from handling cryptocurrencies and working with crypto companies, which amounted to a blanket ban.

In June 2020, the Indian Ministry of Finance had again submitted a bill that was intended to achieve such a general ban.