On Monday, a question was raised in the Lok Sabha regarding the validity of cryptocurrency. When she was asked if there exists a proposal to recognize Bitcoin as a form of currency in India, Nirmala Sitharaman, India’s Finance Minister, responded with a ‘no’.
This information comes just ahead of the Winter Session of Parliament, where the Centre plans the introduction of a Cryptocurrency and Regulation of Official Digital Currency Bill 2021. The bill would provide more clarity on the status and legality of private cryptocurrency in India. On the same note, the government would ban a majority of these cryptocurrencies to make way for advancements in underlying technologies as well as the introduction of its official digital cryptocurrency by the RBI.
As of today, crypto is still unregulated in the country. Back in May, 2021, the RBI issued a circular that advises regulated entities to ensure that customer due diligence processes are carried out with regards to crypto. This also includes adherence to relevant provisions in PMLA, 2002, and FEMA.
In addition to Nirmala Sitharaman’s response to recognize Bitcoin as currency, the Ministry of Finance was also asked if the Centre has validated cryptocurrency exchanges to be a legally permitted entity within the country. The MoS of the Ministry of Finance replied by saying that the Government doesn’t gather information on cryptocurrency trading.
Crypto enthusiasts in the country eagerly await the final outcome of the Winter Session of Parliament to see the status and future of digital currencies in India. As of now, it lies in a gray area.