The government is to make some changes to the current cryptocurrency framework and will be coming out with a Cryptocurrency bill. Due to the changes, will take more than the winter session, said one of the senior government officials.
The ideas discussed are the need for wider consultation and feedback from the public as well as if the Central Bank Digital Currency that is seen to be introduced by the Reserve Bank of India needs to be included in the crypto bill or if it is part of the RBI Act.
Following numerous conversations determining that any legislation related to cryptocurrencies must be compatible with a global framework. Waiting and seeing how this area grows worldwide would be a better option, according to an official. In the meanwhile, the government may take into account current rules and regulations. This is in order to provide consumer protection while taxing bitcoin transactions.
The prime minister of India Narendra Modi mentioned to the people at the Summit for Democracy held by Joe Biden. She explained there should be a united effort for social media and crypto. This will ensure they are doing their best to “empower democracy and not to undermine”.
Regulating the CBDC:
Policymakers are debating whether the CBDC can be in the draft law. Because this is considered money, it can be under the RBI Act, according to an official.
The crypto bill spoken about is the Cryptocurrency and Regulation of Official Digital Currency Bill 2021. It is going public this winter session.
As previously reported, one of the draft bill’s highlights is the appointment of the Securities and Exchange Board of India (Sebi). It is to regulate cryptocurrencies, which the government regards to be financial assets.
Another was setting a deadline for crypto holders to declare their holdings and comply with any new restrictions. According to ET, the law would likely use the word ‘crypto assets’ instead of ‘cryptocurrencies’. It will impose a 1.5-year prison sentence or a fine of Rs 20 crore for violations.