MUMBAI: India plans to pass a law banning special cryptocurrencies such as bitcoin and to develop an official digital currency to be issued by the central bank, according to a legislative agenda listed by the government.
law will create a facilitating framework of official digital currency to issued by the Reserve Bank of India. The legislation, which was debated in the current parliamentary session, said it
“India seeks to ban all private cryptocurrencies, with some exceptions allowing the use of basic technology and cryptocurrencies.”
Mid / 2019 Indian government panel recommended ban on all private crypto currencies with a prison heavy fines for anyone. The panel, however, called on the government to consider launching an official government-backed digital currency to act a banknote through the Reserve Bank of India.
In April 2018, the RBI ordered financial institutions to sever all ties with individuals or businesses engaged in virtual currencies such as bitcoin within three months. However, in March 2020, the Supreme Court of India, allowing banks to conduct cryptocurrency transactions from stock exchanges and traders, dealt a major blow to the emerging industry by lifting the central bank ban.
Governments around the world are looking for ways to regulate cryptocurrencies, but no major economy has taken a drastic step to impose a blanket ban on the use of consumer data and its impact on the financial system.