India’s cryptocurrency ecosystem is on the rise after the government proposed to legislate a ban on private cryptocurrencies during the upcoming winter session of Parliament. Details of the bill are still pending and sources say the cabinet did not address it at its meeting today (November 24).
The Union government says the proposed law aims to create a framework to facilitate the creation of an official digital currency by the Reserve Bank of India. The government also said the law aimed to “ban all private cryptocurrencies.”
“The first important thing is that there are about 15-20 million people in India, holding around $ 4-5 billion in crypto. So the first question is what happens to all this wealth and how do they manage it? ” he said.
He also warned of a massive risk of brain drain.
“With working from home, I think developers and startups will have to leave the country and find another place to go to train,” he warned.
“India will lose massive skills development as the blockchain and crypto technology skill set is one of the fastest growing employment sectors today. So we lose all that, “he added.
The crypto market is estimated to be around $ 3 trillion.
“If India cannot participate, (it) will be a loser in this market as well and that is probably the conclusion if we are really going towards a ban on this new technology,” said Shetty.
What the 2019 bill proposed
The bill sought to “ban the exploitation, possession, sale, trade, issuance, disposal or use of cryptocurrency in the country.” up to 10 years or both.
He added that a person must declare and dispose of any cryptocurrency in their possession within 90 days of the start of the act.
It would be interesting to see how the government balances the view of the Supreme Court which struck down the 2018 RBI Circular which prohibited all regulated banks from holding or facilitating cryptocurrency transactions. A bench of 3 SC judges said the rbi circular was disproportionate and unreasonable.
For the full interview, watch the accompanying video …