India might not ban cryptocurrencies, according to some news reports that quote anonymous source from the government. Reportedly, the source has stated that regulators are primarily concerned about how to effectively regulate the trade.
12 July, AtoZ Markets – In the latest news, some of the online media outlets state that India might not ban cryptocurrencies after all. It appears that an anonymous source from the government has told one of the local media agencies that Indian government might treat cryptocurrencies as commodities.
India Might not Ban Cryptocurrencies
As per this report, a Finance Ministry panel has ordered a study on cryptocurrencies. This might have appeared as a key driver for the authorities to change their decision. A senior government official with knowledge of the discussion in the government has stated that they are unsure about banning cryptocurrencies.
Reportedly, the source has stated that regulators are primarily concerned about how to effectively regulate the trade and identify “where the money is coming from.” They have also added:
“Allowing it as a commodity may let us better regulate trade and so that is being looked at.”
Furthermore, the same official is reported to say that the committee is also looking into the tracking of investors and funds in a bid to combat money laundering and illegal financing. He has been quoted as saying:
“Trade is not a criminal offense. Most of us trade in various asset classes in the stock market. So how is this [cryptocurrency trading] any different? What has to be in place is a mechanism to be sure that the money used is not illegal money, and to track its source is the most important thing.”
Cryptocurrencies are not real currencies?
In addition, the report states that the former deputy governor of the Reserve Bank of India (RBI) R Gandhi has stated that treating cryptos as commodities would indicate that cryptocurrencies are not real currencies. He has been quoted as saying:
“If these are used to settle transactions, then it acquires the nature of currency. So that is one thing that one needs to be wary of. But if people want to invest in a commodity then that is different, because then we can assume that they are aware of the risks involved.”
Back in May, the RBI has announced that it decided not to provide services to any person or firm that is dealing with cryptocurrencies. However, the bank has also earlier stated that it is planning to issue its own cryptocurrency in the future.
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