The impending Crypto Bill, which will change the way the crypto market is currently regulated in India, has sparked a lot of discussion. The overall goal of enacting regulations is to increase accountability and security. By looking at the various dimensions and perspectives surrounding the Crypto Bill, we hope to dispel the misinformation, scepticism, and fear that surrounds it. An examination of the bill’s various dimensions:
01. Fears of a potential blanket ban
In November, a panel discussion between the CEOs of top crypto companies and Members of Parliament concluded that cryptocurrencies cannot be stopped and must instead be regulated.
Given the following facts, a blanket ban would be highly unlikely:
With nearly 10 crore investors, India has a thriving crypto market.
The technological framework of blockchain technology makes imposing a regulatory ban even more difficult.
Crypto is transferred from one wallet to another in the same way that files are shared between networks.
02. Is a regulatory framework possible?
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In December, the government issued a cabinet note stating that cryptocurrencies would be regulated rather than banned.
The government believes that regulation is the best option for ensuring wider adoption and progress of cryptocurrencies.
In addition, the law will include provisions to encourage innovation in the crypto and blockchain industries.
Cryptocurrencies would also be regulated to ensure secure transactions and prevent criminal activity.
In India, however, cryptocurrency will not be made a legal tender.
The Securities and Exchange Board of India will oversee and regulate existing crypto exchanges (SEBI).
The regulatory framework also includes Central Bank Digital Currencies (CBDCs) or the possibility of a digital rupee. The RBI plans to start its CBDC pilot project in the first quarter of the next fiscal year.
03.On the prohibition of private cryptocurrencies
In a government bulletin issued on November 23, the government stated unequivocally that all private cryptocurrencies would be banned, leaving only a few to promote the growth of crypto technology and its applications.
Because private cryptocurrencies are still undefined, nothing can be said with certainty.
It’s important to note, however, that even though cryptocurrencies are anonymous, those built on publicly accessible blockchains can be traced.
Bitcoin and Ethereum are examples of coins that are completely safe and cannot be banned.
Cryptocurrencies, on the other hand, that are built on public blockchain networks but hide transaction information for user privacy may face regulatory issues.