It is expected that the Indian government will release detailed guidelines regarding the regulation of cryptocurrencies by September, the report said a senior official of the Ministry of Finance. Consultation with all stakeholders, including the Central Bank, has already begun. It is reported that this statement is not related to the Supreme court hearings on motions relating to the prohibition of banking cryptocurrency companies.
The government of India has finalized the draft regulatory framework for cryptocurrencies. On Saturday New Indian Express reported that the government is «likely to publish recommendations for the regulation of cryptocurrencies by September». This news follows the statement made last month by Secretary for economic Affairs of the country Subassem Gargon (Subhash Garg), who argued that the bill will be ready by mid-July.
Referring to the fact that the list of stakeholders included the Council for the securities and exchange Board of India (SEBI), Reserve Bank of India (RBI) and the Association of Internet and mobile communications India (IAMAI), an unnamed senior official from the Finance Ministry told the news Agency:
«The project is ready, and, before its final clearance, in consultation with all stakeholders. We expect that the bill will be ready by September».
«The Ministry has established a multidisciplinary Committee under the chairmanship of the Special Secretary for economic Affairs to study the regulatory framework in relation to virtual currencies,» — says the publication. «SEBI and the RBI expressed some concerns on the proposals in the original draft».
How to regulate cryptocurrencies?
New Indian Express quoted an unnamed senior official who said:
«Cryptocurrency is a new phenomenon, and, of course, governments around the world are faced with the problem of their regulation. Most officials have serious reservations against the bill, which we all agree. We want to come to a common conclusion. Should be appropriate mechanism to regulate crypto-currencies».
Although the authorities did not specify how it will be regulated cryptocurrency, Quartz edition reported that a senior government official familiar with the matter, said that they could be regulated as a commodity.
«I don’t believe that someone really thinks about a complete ban of cryptocurrencies. Here we are talking about the regulation of trade, and we need to know where you take their origin money. Allowing the cryptocurrency as a commodity, we can better regulate Commerce, and therefore our views are right upon it,» — says the publication Quartz on July 11.
The official also explained that the cryptocurrency «trading is not a criminal offense». He said:
«What we need to do is to develop a mechanism that will allow us to make sure that involved in the trade of money is not obtained by an illegal search. We also need to be able to track their origin.»
The fight against cryptocurrency companies
The Supreme court of India had initially planned to hold last hearing on all petitions relating to the prohibition of the Central Bank of the country for a banking cryptocurrency companies July 20. However, the date of the final hearing was postponed to 11 September, as no representatives of the Central Bank or the Board securities and exchange Commission on July 20, was not able to prepare convincing arguments in favor of the ban.
The ban on banking companies associated with crypto-currencies was imposed in April. Then RBI has announced that regulated financial institutions are not allowed to serve cryptocurrency exchanges and other related businesses.
Due to the fact that the final decision regarding the prohibition by RBI to be made in September, it seems highly questionable that the publication of the regulation in the same month has nothing to do with this event. It is possible that a complete ban on the cryptocurrency business will not be imposed, however, the RBI clearly wants to spread itself straw to emerge victorious from the litigation. We can only hope for a sound mind and sober memory of the Indian legislators to the fact that during the drafting of the bill they will also take into account the opinion of representatives of the cryptocurrency community, and not just government organizations.