Indian Government Body confirms intent to completely ban Cryptocurrencies

In response to a recent RTI (Right to Information Act) filed by Coincrunch India, the Investor Education and Protection Fund (IEPF) has revealed its intention to completely ban Cryptocurrencies in India.

The Indian Crypto ecosystem has been filled with uncertainty ever since the RBI decided to ban banks from dealing with Crypto exchanges and services, we have seen major players like Zebpay, Unocoin, Coindelta shut down operations in India. While most mainstream media articles paint Cryptocurrencies in a negative light and report anonymous sources who want to ban Crypto in India, it is clear now that certain government bodies like the IEPF intend to ban the sale of Cryptocurrencies in India.

According to the report, a meeting was held on Jan 24, 2019 where the IEPF authority with DEA (Department of Economic Affairs), CBDT (Central Board of Direct Taxes), CBIC (Central Board of Indirect Taxes and Customs) and MCA (Ministry of Corporate Affairs), unanimously decided

“Department of Revenue and Department of Economic Affairs may immediately take steps to completely ban sale, purchase and issuance of all forms and types of cryptocurrencies”.

Image Source: Coincrunch

It is important to note that the two main regulatory bodies RBI (Reserve Bank of India) and SEBI (Securities and Exchange Board of India) were not present in this meeting. In fact, the RBI has denied any knowledge of a bill to ban Cryptocurrencies in a recent RTI filed by Varun Sethi.

While the bill mentions a complete ban on the sale, issuance, and purchase of all forms of Cryptocurrencies, it does not include holding of Crypto assets (which was mentioned in a recent Bloomberg Quint article). The most likely scenario in the case of a complete ban would be that a certain period of time would be given to declare and dispose of the Crypto assets before the ban is effective.

Some important things to note:

1. We are yet to see a draft bill submitted to the Indian parliament.
2. A draft bill does not necessarily mean that it will be approved, in fact, most bills go unapproved in the parliament.
3. The committee has “discussed that it (Cryptocurrencies) has features of Ponzi Scheme” which is not only inaccurate but also lacks nuance as there are a lot of Crypto assets with different features and intentions of use.

Please take action by signing an online petition for “Implementing Regulatory Framework for CryptoAssets in India“

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