New Delhi | Jagran News Desk: The Union government is set to introduce a bill to regulate the circulation of cryptocurrency in India. The bill, titled, ‘The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021’ will be introduced in the upcoming Winter session of parliament. The government aims to introduce, consider and pass the bill in the upcoming session of parliament.

What is ‘The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021’?

According to Loksabha website, the bill aims “to create a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India,” meaning that instead of any private person/body, the RBI will continue to remain the only authority to issue currency in India, be it crypto or otherwise . The Bill further seeks to “prohibit all private cryptocurrencies in India”. However, the Loksabha website adds, the bill “allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses”.

*Must ensure that cryptocurrencies do not end up in wrong hands: PM Modi*

In his first such statement on the matters of cryptocurrency in India, Prime Minister Narendra Modi, while virtually addressing ‘The Sydney Dialogue’ last week, had said that the international order must ensure that cryptocurrencies do not end up in wrong hands. “It is important that all democratic nations work on this and ensure that it does not end up in wrong hands, which can spoil our youth,” said Prime Minister.  

Regulation of Cryptocurrency ‘necessary’: Parliamentary Standing Committee

Earlier, Parliamentary Standing Committee under the chairmanship of BJP leader Jayant Sinha had met the representatives of crypto exchanges, block chain and Crypto Assets Council (CAC). None of the stakeholders, however, were able to decide on a regulator, despite agreeing that a regulatory mechanism was necessary.

At present, there is no regulation or any ban on the use of cryptocurrencies in the country.

Against this backdrop, Prime Minister Narendra Modi, earlier this month, held a meeting on cryptocurrencies with senior officials, and indications are that strong regulatory steps could be taken to deal with the issue.
In the immediate past, there have been a rising number of advertisements, featuring even film stars, promising easy and high returns on investments in cryptocurrencies in recent times, amid concerns over such currencies being allegedly used for luring investors with misleading claims.

RBI Governor Shaktikanta Das too had earlier this month had reiterated his views against allowing cryptocurrencies, saying they are a serious threat to any financial system since they are unregulated by central banks.

The RBI had announced its intent to come out with an official digital currency in the face of the proliferation of cryptocurrencies like Bitcoin, about which the central bank has had many concerns.

Private digital currencies/virtual currencies/ cryptocurrencies have gained popularity in the past decade or so. Meanwhile, regulators and governments have remained sceptical about these currencies and are apprehensive about the associated risks.

Posted By: Mukul Sharma