India Is Ready To Draft Cryptocurrency Regulations in December
Indian regulators have been vocal about their distaste regarding cryptocurrencies. While a non-stop tussle continues between the government and crypto enthusiasts in the country, it seems that regulatory policies on cryptocurrencies may soon be spelt out by the authorities.
A panel set up by the finance ministry in November 2017 for the express purpose of studying, researching and formulating the regulation for the cryptocurrency, might introduce draft regulations next month. The same came into the light when a counter-affidavit filed by Narendra Modi government was provided in a Supreme Court case that is foreseeing the Indian cryptocurrency exchange industry challenging the banking ban enforced by the central bank earlier this year.
According to a Quartz report on Tuesday, the finance ministry panel that is headed by Subhash Chandra Garg, secretary in the department of economic affairs has been working upon drafting the norms for virtual currencies, an excerpt from the government’s counter-affidavit reads:
“…currently, serious efforts are going on for preparation of the draft report and the draft bill on virtual currencies, use of distributed ledger technology in (the) financial system and framework for digital currency in India. The draft report and bill will be circulated to members of IMC (inter-ministerial committee). Thereafter the next meeting of IMC will be held so that discussion can take place on the draft report and bill. It is expected that the draft report will be placed before the IMC by next month.”
Furthermore the affidavit states that the draft bill and report will be forwarded to members of the finance ministry’s inter-ministerial committee. A meeting held sometime in December will have the committee members discussing the integrities of the draft.
The Reserve Bank of India (RBI), in April this year, asked all the financial institutions in the country to seize their business relationships with virtual currency exchanges within three months. Following the orders that impacted several crypto entrepreneurs, a case was filed against the RBI and the Modi government accusing them of sabotaging the entire ecosystem.
During a hearing on Oct 25, the court asked the government to file a counter-affidavit and outline its policy regarding virtual coins, which is still being formulated. Notably, the counter-affidavit filed by the government mentions that the panel including India’s taxation, budget and economic affairs ministries as well as central bank representatives have held two meetings—on Nov. 27, 2017, and Feb. 27 this year.
Subsequently, several other meeting was also observed to discuss and understand the working and the requirements of the cryptocurrency ecosystem. It was mandated to submit draft regulations by July this year but it has been delayed. The case filed by the bourses is expected to come up for hearing by a bench comprising justices RF Nariman and Navin Sinha in the supreme court today (Nov. 20).
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