India to ban private cryptocurrencies, bill to be tabled in parliament

The Narendra Modi-led government has listed a bill for the upcoming Parliament session that reportedly seeks to prohibit all private cryptocurrencies in India, but with certain exceptions.

The winter session of parliament is scheduled to take place from November 29.

The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, is among the 26 new bills that have been listed for the government's legislative agenda.

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The government said its objective is “to create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India."

The development comes days after Prime Minister Narendra Modi raised concerns about cryptocurrencies and called for regulating them. India has been one of the countries where investments in cryptocurrencies have been growing exponentially with expectations of higher returns.

The Indian government has repeatedly stressed that a regulatory mechanism was needed to regulate cryptocurrency investments.

While addressing the Sydney Dialogue—a forum on emerging, critical and cyber technologies—Modi called upon all the countries to join hands to ensure that the cryptocurrency is not misused.

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“Take crypto-currency or bitcoin for example. It is important that all democratic nations work together on this and ensure it does not end up in the wrong hands, which can spoil our youth," said PM Modi on November 18.

Earlier this week, a parliamentary panel was convened to discuss the board contours of crypto finance. 

The Standing Committee on Finance, chaired by Lok Sabha member Jayant Sinha, met with officials from crypto exchanges, the Blockchain and Crypto Assets Council (BACC), industry organisations, and other stakeholders to explore concerns about cryptocurrency regulation and promotion in India.

Moreover, India's central bank chief Shaktikanta Das has repeatedly expressed reservations over cryptocurrency investment in India.

(With inputs from agencies)