India’s inter-ministerial committee (IMC) proposes a ban on cryptocurrencies

  • The submitted report and the draft bill will undergo review and a series of consultations.
  • “The Group has recommended the banning of the cryptocurrencies in India, IMC report.

The rumors that have circulated across the crypto space that India could be moving towards putting a blanket ban on digital currencies have unfortunately been confirmed. The inter-ministerial committee (IMC) od the government of India in a report accompanied by a draft bill has been submitted to the government.

The IMC is made up of the Secretary (Economic Affairs) who is the chair, the Secretary, ministry of electronics and information technology, SEBI chairman as well as the reserve bank of India’s deputy governor.

The submitted report and the draft bill will undergo review and a series of consultations with regulatory authorities and other departments of concern. Following the review, a decision will be made with regards to the fate of digital assets in India.

The website of the Department of Economic Affairs website has already listed the draft bill titled ‘Banning of Cryptocurrency & Regulation of Official Digital Currency Bill, 2019’ and the report.

A statement by the government regarding the report reads:

“In the Report, the Group has highlighted the positive aspect of distributed-ledger technology (DLT) and suggested various applications, especially in financial services, for use of DLT in India. The DLT-based systems can be used by banks and other financial firms for processes such as loan-issuance tracking, collateral management, fraud detection and claims management in insurance, and reconciliation systems in the securities market.”

A section of the report that directly refers to banning of cryptocurrencies states:

“As for private cryptocurrencies, given the risks associated with them and volatility in their prices, the Group has recommended banning of the cryptocurrencies in India and imposing fines and penalties for carrying on of any activities connected with cryptocurrencies in India.”

In addition to that, the IMC recommends that a Standing Committee be established to look into issued related to cryptocurrencies.

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