According to people familiar with the matter, India is considering a proposal to treat cryptocurrencies as financial assets while protecting small investors.
The discussion comes as the Center races for officials to finalize a bill in the session beginning November 29. The law could set a minimum amount for investment in digital currencies while banning their use as legal tender, the people said, asking not to be identified as no final decision has been taken.
Policymakers shrugged themselves off by posting details of the bill on parliament’s website late Tuesday, saying the bill would “enforce all private cryptocurrencies, with a few exceptions, to promote the underlying technology of the cryptocurrency and its uses.” tries to ban.”
Uncertainty triggered a selloff in cryptocurrencies including Shiba Inu and Dogecoin on Wednesday, which were down more than 20% in trading on the WazirX platform, one of India’s leading cryptocurrency exchanges. They were little affected by trading platforms like Binance or Kraken.
A finance ministry spokesperson could not be immediately reached for comment.
The Reserve Bank of India (RBI) wants a complete ban on digital currencies as the central bank feels it could affect the country’s macroeconomic and financial stability. While the government is considering taxing gains from cryptocurrency in the next budget, RBI Governor Shaktikanta Das last week said that the country needs a very in-depth discussion on the issue.
People said the Prime Minister’s Office is actively looking into the issue, and after finalizing the contents of the bill, it will be taken up for cabinet approval.
Earlier this month, PM Modi held a meeting on cryptocurrencies, following which officials said that India will not allow unregulated crypto markets to become a path for money laundering and terror financing. Later, in a speech last week, he urged democracies to cooperate in regulating private virtual currencies, which could put them in the “wrong hands”.