India will pass a law banning cryptocurrencies, fining anyone who trades in the country or owning such digital assets, a senior government official told Reuters that there could be incidents of investors entering the hot stock market.
The bill, one of the world’s strongest anti-money laundering policies, would criminalize the acquisition, extraction, mining, trading and transfer of crypto assets, said the official, who has specific information on the program.
The measure is in line with the government’s January agenda that sought to curb virtual private equity funds such as bitcoin while creating a legal digital currency framework. But recent government comments have boosted investors’ confidence that the authorities could easily navigate the thriving market.
Instead, the bill will give cryptocurrencies holders up to six months to complete, after which fines will be levied, said the official, who asked not to be identified as the content of the bill was not public.
Officials are confident that the bill will be enacted as Prime Minister Narendra Modi’s government has played a key role in parliament.
If the ban became legal, India would be the first major economy to make cryptocurrency seizures illegal. Even China, which has banned mining and trade, does not charge for detection.
The Treasury did not immediately respond to an email requesting comment.
‘CHECK US’ TO PAY ‘CRAZY’
Bitcoin, the world’s largest cryptocurrency, reached a record high of $ 60,000 on Saturday, almost doubling its value this year as its acceptance of payments has increased with the support of top supporters such as CEO of Tesla Inc Elon Musk.
In India, despite government threats to ban, the transaction value is growing and 8 million investors now hold 100 billion rupees ($ 1.4 billion) in crypto investment, according to industry estimates. No official data are available.
“Money is growing fast every month and you don’t want to sit on the sidelines,” said Sumnesh Salodkar, a crypto investor. “While people are nervous about the ban, greed is what drives these decisions.”
User registrations and revenue for Bitbns on the crypto exchange site have increased 30 times since last year, said Gaurav Dahake, chief executive officer. Unocoin, one of India’s oldest channels, added 20,000 users in January and February, despite concerns about the ban.
ZebPay “made as much volume per day as February 2021 as we did throughout February 2020,” said Vikram Rangala, chief marketing officer.
Top Indian officials have called cryptocurrency a “Ponzi scheme”, but Finance Minister Nirmala Sitharaman this month reduced investors’ complaints.
“I can give you this clue that we are not closing our minds, we are looking at possible ways of testing in the digital world and in cryptocurrency,” he told CNBC-TV18. “There will be a very balanced position.”
A senior official told Reuters, however, that the system was blocking crypto private assets while promoting the blockchain – a secure database technology that is the backbone of real money but also a program that experts say could transform international trade.
“We have no problem with technology. There is nothing wrong with the use of technology, “the official said, adding that government measures would be” measured “in terms of penalties for those who did not dispose of crypto assets within the legal period.
A government panel in 2019 recommended the inclusion of a 10-year prison term for people who own, manufacture, hold, sell, transfer, dispose of, dispose of or operate cryptocurrencies.
The official declined to say whether the new bill included prison sentences as well as fines, or provided further details but said negotiations were in their final stages.
In March 2020, the Supreme Court of India overturned a 2018 order by a major bank that prohibited banks from dealing with cryptocurrencies, prompting investors to move to the market. The court ordered the government to take office and write a law on the matter.
The Reserve Bank of India has expressed its concern and last month, citing what it says is a threat to financial stability from cryptocurrencies. At the same time, the central bank was working to introduce its own digital currency, a move that would be proposed by a government bill, the official said.
While there is excitement in the market, investors are aware that the explosion could be in jeopardy.
“If the ban is legal we must follow the law,” Naimish Sanghvi, who started betting on digital money last year, told Reuters, expressing concern about possible sanctions. “Until then, I’d rather collect and run with the market than rush to sell.”