Rumors that India might be considering a new ban on crypto may be premature, according to exchange founders and startup CEOs working in the sector.
Indian news site The Economic Times created a stir Friday by suggesting lawmakers in India, where the Supreme Court a from the Reserve Bank of India (RBI) only four months ago, were planning on slapping a new ban on crypto companies.
The , titled “With a law, India plans lasting ban on crypto,” cited one unnamed “senior government official” who told The Economic Times, “A note [presumably on crypto] has been moved (by the finance ministry) for inter-ministerial consultations.”
The article doesn’t provide any information on what the note could be but says it was spurred on by the Supreme Court ruling, which allowed crypto exchanges to finally access banking services after nearly two years stuck in the wilderness.
The article said the government could lean on a previous government draft law, from July 2019, that proposed all forms of cryptocurrency be banned, with anyone caught holding them facing up a fine and up to 10 years imprisonment.
But is there any substance to this?
Well, the report in question relates to one by a government panel, chaired by former Economic Affairs Secretary Subhash Chandra Garg. While the report recognizes blockchain technology is an “important new and innovative technology,” it notes, “with serious concern,” that the use of cryptocurrencies in India is “mushrooming” at an alarming rate.
Highlighting that many crypto assets don’t have any intrinsic value and supporting the RBI ban, the report concludes: “The Committee has recommended a law banning the cryptocurrencies in India and criminalising carrying on of any activities connected with cryptocurrencies in India.”
The only exception, they say, would be a digital currency issued by the state itself.