The dilly-dallying in the final decision on cryptocurrency transaction in India has become a case in point where the government kept all including crypto platforms, founders and stakeholders in dilemma.
While Supreme Court has postponed the hearing of the case till the second week of July, the Indian government has proposed a jail term of up to 10 years for mining, holding or selling cryptocurrencies.
According to the draft Banning of Cryptocurrency and Regulation of Official Digital Currency Bill, 2019, the government will also propose the introduction of an official ‘Digital Rupee’ in consultation with the central board of RBI.
The draft was first accessed by Bloomberg Quint.
In 2018, the govt has constituted a panel under finance secretary Subhash Chandra Garg to draft regulations for cryptocurrencies.
Other members in the panel including Department of Economic Affairs (DEA), Central Board of Direct/Indirect Taxes (CBDT) and others are also in favour of a complete ban on the sale, purchase, and issuance of all types of cryptocurrency.
The draft bill further stated that the court shall decide the appropriate prison sentence and a fine that include penalty imposed on the accused shall be either thrice the loss caused to the system or three-fold the gains made by him/her, whichever is higher.
It also added that a person holding virtual currency will have to declare and dispose it within 90 days from the date of commencement of the Act.
In case of the government launching its own digital currency, it would be governed by regulations under RBI Act, 1934.
Meanwhile, industry observers and experts think that a complete ban on virtual currency in India may prove to be counterproductive.
Of late, Facebook revealed a plan to test its virtual currency in India. Codenamed as Libra, it allows users to transfer money for remittances via WhatsApp through Stablecoin.