Parliamentary panel on crypto: regulate, don’t ban, say several members

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A parliamentary panel, chaired by BJP leader Jayant Sinha, discussed the pros and cons of crypto-finance with various stakeholders on Monday, and several members were in favor of regulating cryptocurrency exchanges rather than impose an outright ban on cryptocurrencies, sources say.

The meeting took place against a backdrop of growing concerns in various circles regarding cryptocurrencies and the possible risks arising from their trading, especially as there is growing interest in these assets around the world. Currently, there are no specific regulations or outright ban on using cryptocurrencies in the country.

Representatives from the crypto exchanges, blockchain and Crypto Assets Council (BACC), industry bodies as well as academics and other stakeholders presented their views to the panel, including the meeting. also took place days after Prime Minister Narendra Modi had discussions with senior officials from various ministries and RBI on the issue of cryptocurrencies.

This is the first meeting on the subject convened by the Standing Parliamentary Committee on Finance. The panel is chaired by Sinha, who is also a former Minister of State for Finance.

The sources said that overall, panel members wanted regulations for crypto currency trading and were not in favor of banning crypto currencies.

Some members of Congress on the panel told PTI that there are significant challenges in banning cryptocurrencies.

The general opinion of the panel was that a Chinese wall should be put in place on the fungibility of cryptocurrencies in the real world and that its interface with the real world should be regulated, they added.

Currency is a domain of the sovereign where its value is secured and cryptocurrency is a computer program managed in a format distributed on the internet. Its value is only discovered by a buyer and user on an exchange which itself is illegal, they noted.

One of the members even wondered how cryptocurrencies are going to be regulated when even the regulation of the internet remains difficult.

Members also expressed concerns over the possibility that cryptocurrencies could be used to finance terrorist activities.

In the morning, panel chair Sinha said the crypto finance meeting will discuss the opportunities and challenges this fast-paced industry presents to regulators and policymakers.

“We called on stakeholders from across the industry, including major stock exchange operators, members of CII as well as academics from the Indian Institute of Management (IIM) Ahmedabad, who did a very in-depth study on crypto-finance, ”Sinha told PTI. .

In addition, he said the panel called representatives from India’s Internet and Mobile Association of India, including Blockchain and Crypto Assets Council (BACC), a specific body that deals with players in crypto finance.

“We will hear their views on the appropriate regulatory framework for this industry as it continues to develop and evolve,” he said.

On March 4, 2020, the Supreme Court quashed an RBI circular of April 6, 2018, prohibiting banks and entities regulated by it from providing virtual currency services.

On February 5, 2021, the central bank instituted an internal panel to suggest a model for the central bank’s digital currency.

The RBI had announced its intention to release an official digital currency amid the proliferation of cryptocurrencies that worries the central bank.

(Only the title and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)

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