There is information that there is a draft bill named “Banning of Cryptocurrencies and Regulation of Official Digital Currencies Bill 2019″ circulating through the various departments of the Indian government. The bill, if adopted could see an end to the adoption of cryptocurrencies in India, which would be a great blow to blockchain developers throughout the world, considering the large population in India that is seen as a great opportunity for cryptocurrency communities.
The government is currently said to be consulting the different ministries on the issues so as to come up with a conclusion on the way forward.
Familiar sources indicate that a committee of comprising of the Department of Economic Affairs (DEA), the Central Board of Indirect Taxes and Customs (CBIC), the Investor Education and Protection Fund Authority (IEPFA) and the Central Board of Direct Taxes (CBDT) is supporting the idea to ban any cryptocurrency activities in India including the issuance, sale and purchase of the digital currencies.
The Committee could use the Prevention of Money Laundering Act (PMLA) to ban the cryptocurrencies since it argues out that the digital currencies are a haven for money laundering and other fraudulent schemes. The ministry of Cooperate affairs has previously said that the cryptocurrencies are being used to swindle innocent investors of their money.
This development comes after the Supreme Court of India gave the Indian Authorities 4 weeks to structure regulatory policies for cryptocurrencies so that the court could stop handing cryptocurrency cases including the demand for the reverse of the Reserve Bank of India circular on cryptocurrencies.
There were also concerns from India Economic Affairs Secretary that the digital currencies would greatly impact the Indian currency if they were to be fully adopted as modes of payments.