Three sets of questions were asked by the Indian government in Parliament about bitcoin transactions and the highly publicized scam that took place in Karnataka. They also inquired about the legality and legality of Indian cryptocurrency trading. The Winter session of Parliament has already begun. A crypto bill will likely be discussed during that session.
Indian Government Responds to Questions about Bitcoin Transactions
On Monday, the Indian Ministry of Finance answered three sets of questions on bitcoin and cryptocurrency trading in Lok Sabha, the lower house of India’s parliament.
First set of questions, Starred Question No. 12), titled “Bitcoin Transactions,” ask Finance Minister Nirmala Sitharaman “whether the government is aware that bitcoin transaction is silently blooming in India in the recent years.” The finance minister replied:
It does not keep any data about bitcoin transactions.
Finance Minister Sitharaman was further asked “whether the government has any proposal to recognize bitcoin as a currency in the country.” She simply replied: “No, sir.”
Questions regarding the Bitcoin Scam at Karnataka
Unstarred Question No. 2 is the second set of questions. 196) are about the high-profile “Bitcoin Scam in Karnataka,” which recently received heavy media coverage. Basavaraj Bommai, the Chief Minister of Karnataka, brought up this matter during his meeting in Delhi with Prime Minister Narendra Modi.
Questions were asked to the Finance Minister about the scheme and specific details regarding the investigation.
The Minister of State in the Ministry of Finance, Shri Pankaj Chaudhary, replied: “Information in public domain suggests that a case of cybercrime involving bitcoin has been under examination by the Karnataka police … However, a case has also been registered by Bangalore Zonal Unit of the Directorate of Enforcement. Further disclosure of information in the matter is not in larger public interest.”
Questions regarding the legality and regulation of cryptocurrency trading in India
Unstarred question No. 173), titled “Cryptocurrency,” ask the finance minister “whether the government is aware of the cryptocurrencies that are traded in India.” Minister Chaudhary responded:
Information about trading in cryptocurrency is not collected by the government.
A question was also put to the finance minister asking whether cryptocurrency trading is legal in India, and whether exchanges for crypto currency are legally recognized entities. A second question asked her to list any Acts relating to cryptocurrency or crypto exchanges.
Minister Chaudhary replied: “Cryptocurrencies are unregulated in India. RBI [the Reserve Bank of India] has vide its circular dated May 31st, 2021, advised its regulated entities to continue to carry out customer due diligence processes in line with regulations governing standards for know your customer (KYC), anti-money laundering (AML), combating of financing of terrorism (CFT) and obligations of regulated entities under Prevention of Money Laundering Act, (PMLA), 2002 in addition to ensuring compliance with relevant provisions under Foreign Exchange Management Act (FEMA) for overseas remittances.”
The Winter Session begins
Monday marked the beginning of the winter session. The session is scheduled to include a cryptocurrency bill. The bill has not been added to the agenda on Monday and Tuesday.
“The Cryptocurrency and Regulation of Official Digital Currency Bill 2021” seeks “to prohibit all private cryptocurrencies in India, however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses,” according to the legislative agenda for the winter session of Lok Sabha.
The bill also provides “a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India.” The RBI has previously said that it is working on a digital rupee which it plans to launch in phases.
It is not known what the Indian government intends to do with the contents of its crypto bill. This has created speculation as to whether it will either ban cryptocurrency like Bitcoin and Ethereum or create a regulatory environment for them.
What do you think about the Indian government’s answers? Comment below to let us know your thoughts.
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