Government officials in India said on Tuesday that they will be introducing a new financial regulation bill.
Aptly named “Cryptocurrency and Regulation of Official Digital Currency”, the bill will lay the groundwork for the country’s central bank, the Reserve Bank of India (RSI), to create a digital currency of its own, while at the same time banning all private cryptocurrencies.
Effectively, any cryptocurrency that has not been approved or issued by the RSI will fall in the unregulated market. This could be bad news for the country’s thriving crypto industry.
The move comes amid appeals to the international community by Indian prime minister Narendra Modi to work together to introduce a unified framework for the regulation of digital assets. India previously issued a ban on disingenuous crypto ads.
India fears that cryptocurrencies continue to circulate in a lax environment that allows criminal organizations to launder money or fund terrorist operations.
However, Reuters has been able to get in touch with sources who claim that the government wants to list crypto as asset classes rather than currencies, which could see them reintroduced at official exchanges.
The RSI would not be too willing to take the side of private cryptocurrencies. The central bank has repeatedly criticized such currencies, pointing out that they are often used by criminal parties.