EXCLUSIVE: Mindful of consequences of ban, Modi govt reconsiders approach to crypto law

The government is considering reworking the proposed cryptocurrency regulation and likely introduce it only in the Budget session next February.

"Discussions are ongoing and key issues like the treatment of private cryptocurrencies, the rationale of regulation and global practices is being looked into once again", a senior government functionary told Business Today TV earlier today.

The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, had been listed for the current winter session of Parliament. It had been listed in the monsoon session of Parliament as well. The first attempt to frame a legal and regulatory framework for cryptocurrencies in India had been initiated in 2019. Since then, crypto investing has caught on in the country, with the recent explosive growth all through 2021 catching policymakers and India's central bank by surprise.

The latest delay is on account of discussions held at the highest levels of government. While the proposed draft Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 aims to prohibit private cryptocurrencies with certain exemptions, officials now claim that the government is thinking through all options again. Policy makers want to factor in various approaches, including the potential impact a ban on all private cryptocurrencies could have on innovation and block chain technology in India.

Earlier, Prime Minister Narendra Modi had called for all democratic nations to work together to ensure that cryptocurrencies do not end up in the wrong hands and spoil the youth.

On its part, the Reserve Bank of India has stuck to its guns, warning that there are serious issues involved and deeper, well-informed discussions are needed on cryptocurrencies before a law is framed.

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