Union Budget 2021: According to reports, the Bill will also pave the way for the RBI to create a “facilitative framework” to issue an official digital currency.
New Delhi | Jagran Business Desk: The central government will likely bring a Bill seeking a ban on all private cryptocurrencies, including Bitcoin and Ripple, in India in this Parliament Budget Session.
According to media reports, the Bill will also pave the way for the Reserve Bank of India (RBI) to create a “facilitative framework” to issue an official digital currency. The proposed legislation, however, will allow for “certain exceptions to promote the underlying technology of cryptocurrency and its uses”.
Notably, the RBI had also banned crypto transactions to avoid financial frauds and prohibited trading in such digital currencies in 2018. The ban, however, was revoked by the Supreme Court in March last year. The top court had also allowed banks and financial institutions to provide services related to cryptocurrencies.
“When the consistent stand of RBI is that they have not banned VCs (virtual currencies) and when the Government of India is unable to take a call despite several committees coming up with several proposals including two draft bills, both of which advocated exactly opposite positions, it is not possible for us to hold that the impugned measure is proportionate,” the top court had said, as reported by news agency PTI.
Meanwhile, the RBI, in its booklet on payment systems that was printed on January 25, had hinted that it is exploring ways to issue an official digital currency in India. In its book, the central bank had claimed that digital currencies are gaining popularity across the world and it is “exploring the possibility as to whether there is a need for a digital version of fiat currency and, in case there is, how to operationalise it”.
Cryptocurrency exchanges have seen a sharp increase in their users in India since the Supreme Court lifted the Centre’s ban. However, industry experts have also raised concerns over the use of cryptocurrencies. Some experts even claim that the government might not allow “cryptocurrencies gain prominence over their fiat money”.