India might soon announce its first draft for their cryptocurrencies legal framework as the Indian government panel appointed to for the purpose have reportedly submitted their report to the country’s finance minister. Though the content of the reports hasn’t been disclosed yet, analysts and industry participants place their guesses.
Led by Subhash Chandra Garg, the country’s Economic Affairs Secretary, the panel was appointed by the Indian government, to thoroughly study cryptocurrencies and draft regulations that will govern their future in the country. The panel revealed in November that they would be ready to draft cryptocurrency regulations in December. Touted to release in July this year the draft was delayed to the year-end as the panel required more time.
No information regarding the report or its content has been released as of yet, though that did not halt the speculations. A local media channel, CNBC TV 18, who reported the submission of the report could not affirm any concrete information about the content of the report.
However, the news outlet did talk to various anonymous sources. The source claims that the report suggests a new legal framework within the Reserve Bank of India (RBI) guidelines should be put in place in order to ban cryptocurrencies. The new law should clearly specify that any kind of dealing in such currencies should be treated as illegal.
On the other hand, the CEO of Indian crypto exchange Wazirx, Nischal Shetty, told news.Bitcoin.com:
Several times we’ve heard such stuff in the news before. Until we get to see the report I would not suggest anyone to jump to conclusions.
Shetty has been quite actively running a Twitter campaign in order to urge the Indian government to introduce positive regulation for the crypto industry in the country.
Interestingly, in the Indian crypto-regulatory space, the word “ban” has been loosely used. Crypto Kanoon, a platform engaged in crypto regulatory analysis, pointed out in October that it is applicable over buying, selling, transacting, or its conversion of cryptocurrencies into rupees, but it probably does not apply on possession of the digital assets.
Currently, the information regarding cryptocurrencies are under a murky state as far as Indians are concerned, the ban exercised by RBI on the financial institution is mostly mistaken as an overall ban on the ecosystem by the layman. Moreover, the finance minister pronounced the virtual assets as illegal tender in his February budget speech.
Notably, they said it is not a legal tender in the country not that it is illegal in the country; there is indeed a marginal difference between the two.
While a bunch fear that India could and would exercise a complete ban over cryptocurrencies, a number of experts deem it impossible. According to them India can only successfully ban known, big exchanges. However, small hyperlocal exchanges will possibly come up and it will be extremely difficult to keep track of and block them.
This can also be observed from China’s attempt at banning the virtual assets. Despite various strict warnings and efforts by the government cryptocurrency adoption saw an uprise. While the government can bottleneck the ecosystem, it cannot eradicate it from the very roots.