India to ban all private cryptocurrencies in Parliament | IAS TARGET IAS Target

India to ban all private cryptocurrencies in Parliament

17 Nov 2021

Category : Economical Issue

Topic: India to ban all private cryptocurrencies in Parliament

Context:

India will ban private cryptocurrencies during the winter parliamentary session but will allow some exceptions to promote the underlying technology of cryptocurrencies.
The Cryptocurrency and Official Digital Currency Regulation Act, 2021, will be submitted for review and approval during the winter session of Parliament. The bill also aims to provide a framework for official digital currencies issued by the Reserve Bank of India.
However, cryptocurrency law allows specific exceptions to facilitate the underlying technology and its use. The details of the exception are not yet known. The development was the first parliamentary panel on cryptocurrencies led by BJP MP and former Federal Minister Jayant Singha in November to represent crypto exchanges, the Blockchain and Cryptocurrency Council (BACC), industry groups and other interests.
Last week, Prime Minister Narendra Modi also hosted a high-level meeting with various ministries and RBI officials to advance India's cryptocurrency. The report previously argued that the government is unlikely to ban cryptocurrencies, but it may take a cautious approach to such investments and allow them as assets rather than currencies.
Cryptocurrency Prices Fall Fear Sources banning private cryptocurrencies from the Indian government previously said that the government's actions are progressive and cheerful, but cryptocurrencies Misleading ads should be stopped. Concerned about potential risks for Indian investors, the centre also believes that the unregulated crypto market should not be misused for money laundering or terrorist financing.
Market experts fear that an unregulated environment with multiple platforms to advertise too promising and opaque can mislead investors and lead to huge losses.
The RBI has also repeatedly raised concerns about cryptocurrencies. According to the RBI, Cryptocurrencies are a severe issue, and there are concerns about macroeconomic and financial stability. Therefore, the RBI has made detailed proposals to the government, and the government is actively considering the issue.
Most cryptocurrencies do not survive. It raises the same question as an unregulated chit fund.

What is a private cryptocurrency?

Success (of the bill) depends on the details, especially the definition of what the bill calls a "private cryptocurrency." This is not a general term. Not everyone owns Bitcoin personally. It's a public good like the Internet.
Cryptocurrency is based on blockchain technology. Blockchain stores information electronically in digital format. According to Investopedia, anyone on the public blockchain is free to participate and participate in the core activities of the blockchain network. Private blockchains, on the other hand, allow only selected entries from validated participants.