Will India Ban Cryptos? This Report Says They Won’t

As the regulatory talks about cryptocurrencies in India keep underway, a new report emerged in local media which claims that the national government will regulate them instead of imposing a ban.

A note drafted by the Indian government’s cabinet and cited by NDTV suggested that possibility, which goes contrary to the initial plans of banning “private cryptocurrencies.” However, it seems that India definitely closed the doors to recognize digital assets as currencies and Bitcoin (BTC) as legal tender.

No Mention on the Planned Indian CBDC

If plans go as expected and the cabinet note becomes a reality, the Securities and Exchange Board of India (SEBI) would be the entity in charge of supervising all crypto-related activities, including overseeing crypto exchange platforms. Still, the cabinet’s note did not mention a central bank digital currency (CBDC).

The government seeks to apply Prevention of Money Laundering Act (PMLA) rulings to prevent any crimes from being performed via cryptocurrencies, which aligns with the original concerns raised by the local authorities.

In fact, Nirmala Sitharaman, India’s Finance Minister, pointed out that she was afraid that cryptos could get in the wrong hands. However, she clarified that the government doesn’t monitor any BTC transactions.

Penalties for Crypto Exchanges

Among the rules are imposing fines on crypto exchanges that fail to be compliant, which are at risk to face monetary penalties of up to $2.6 million approximately.

The report also suggests that the new proposal could get cleared at any point in next week, in a country that remains reluctant to widely adopt cryptocurrencies for their daily routines, according to a poll unveiled by LocalCircles and quoted by Business Today.

The survey said that 49% of respondents have no trust in virtual currencies.

Although the report was just revealed today by the local media, there is no official confirmation from the national government as of press time, and no updates have been given about the planned CBDC.