Bitcoin on highway to being legit

Anuradha Shukla

NEW DELHI: Holding cryptocurrency like Bitcoin is banned in India, but that could change, as the second interdisciplinary committee is in favour of legalising it, with harsh riders.

“We have already had two meetings. There is a general consensus that cryptocurrency cannot be dismissed as completely illegal. It needs to be legalised with strong riders. Deliberations are on. We will have more clarity soon,” a senior official who attended the panel’s meetings told this paper. The committee has met twice on the issue and is likely to submit its report to the finance ministry by February next.

The government set up the first interdisciplinary committee led by special secretary Dinesh Sharma (now retired) with members from CBDT, Ministry of Home Affairs, MeitY (Ministry of Electronics and Information Technology), RBI, NITI Aayog and SBI in March 2017. Four months later, the committee recommended a total ban on cryptocurrency in India with immediate effect.

Soon after, an RBI circular rendered cryptocurrency illegal. And the finance ministry on December 29, 2017, and Finance Minister Arun Jaitley in his budget speech on February 1, 2018, echoed the harsh line.
However, various stakeholders challenged the RBI fiat in the Supreme Court. After conflicting opinions, the government set up the second inter-ministerial committee, led by the Department of Economic Affairs secretary Subhash Chandra Garg.

Members of the second inter-ministerial committee include the revenue secretary and officials from SEBI, RBI and MEITY. Recently, G20 countries agreed to introduce regulations on crypto assets to counter money laundering and financial terrorism. That was in line with the thought process in the Financial Action Task Force, another inter-governmental body.

In fact, some of the second interdisciplinary committee members, such as RBI executive director Ganesh Kumar and Finance Ministry officials have already actively participated in G20 and FATF working group meetings. They are expected to include insights they gained from the global deliberations in their report. The panel is likely to meet next in January. “We have also taken inputs from cryptocurrency exchanges and experts and will be examining legal issues with the law ministry. It’s a complicated issue. Once all aspects are decided, then we will have more clarity,” the official added.

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