Government Committee Increases Pressure to Ban Bitcoin in India

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An inter-ministerial committee (IMC) in India has poured cold water on a fresh, optimistic outlook on the future of Bitcoin in the country. The committee, which boasts some high-ranking officials, have suggested banning private cryptocurrencies such as Bitcoin. 

It comes after Anurag Thakur, India's Minister of State for Finance & Corporate Affairs, reaffirmed that Bitcoin remained legal earlier this week and promised that regulations were on their way. Now, however, it could be that these regulations may be a lot stricter than expected. 

The report from the minsters not only suggests outlawing private cryptocurrencies but indicates that the creation of a government-owned digital asset should be the way forward when it comes to cryptocurrencies. 

Hard on cryptocurrencies

The Reserve Bank of India (RBI) has already flexed its muscle in its disapproval of Bitcoin, having blocked its services to any businesses operating with cryptocurrencies. Now with the aid of influential ministers, they are pushing their agenda even further. 

The committee comprises of the Secretary (Economic Affairs) as the chairman, along with the Secretary, ministry of electronics and information technology, SEBI chairman and the deputy governor of the Reserve Bank of India. 

Their suggestion to ban Bitcoin would thus hand them total control of digital currencies in India as the report also begins to outline the introduction of an official digital currency which can be provided the status of a legal tender, regulated by the RBI.

The relevant parties submitted this report along with a draft bill called the 'Banning of Cryptocurrency & Regulation of Official Digital Currency Bill, 2019', which has been listed on the official Department of Economic Affairs website.

A state of confusion

It is a difficult time for cryptocurrency businesses, users, and enthusiasts in India currently. The rumors and reports continue to fly with no official stance being made. One day, a minister states that Bitcoin is legal, then the next a draft bill to ban Bitcoin is put forward. 

India has already seen a massive decline in its operating exchanges, and other cryptocurrency-related businesses as the RBI's strict rules have killed off that side of the emerging economy. 

The ambiguous regulations and rulemaking also make it hard for any business to get a foot in the door should India not decide to put an outright ban on Bitcoin. 

However, what has become more evident is that the RBI and certain Indian officials are not against cryptocurrencies and how they operate; instead, they are not willing to accept a decentralized financial system. The push for banning Bitcoin and then creating an RBI-backed digital currency point towards the intentions of the country's regulators. 

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