Daily Management Review

Proposed India Bill Prohibiting Crypto Payments Might Result In Jail Time For Violators –Reports


Proposed India Bill Prohibiting Crypto Payments Might Result In Jail Time For Violators –Reports
A planned legislation by the Indian government that would prohibit the use of cryptocurrencies as a form of payment will also expose people who violate the law to arrest without a warrant and detention without bail, according to reports quoting sources and a description of the legislation as reviewed by them.
The government of Prime Minister Narendra Modi has already stated that it intends to prohibit the majority of cryptocurrencies, a move that follows China's September steps that tightened its grip on cryptocurrencies.
According to the bill's description, the Indian government intends to impose a "wide restriction on any acts by any individual relating to mining, creating, holding, selling, (or) trading" in digital currencies as a "medium of exchange, store of value, and unit of account."
Any violation of these guidelines would also be "cognizable," which means an arrest without a warrant is feasible, and "non bailable," according to the proposed bill.
There were no responses to the reports form the Indian finance ministry.
Although the government has previously said that it wishes to support blockchain technology, lawyers believe that the new regulation would have a negative impact on its use as well as the non-fungible token market in India.
"If no payments are allowed at all and an exception is not made for transaction fee then it will also effectively stop blockchain development and NFT," said Anirudh Rastogi, founder of law firm Ikigai Law.
The government's proposal to severely restrict cryptocurrency trading prompted a market frenzy, and numerous investors departed with substantial losses.
The number of investors in crypto assets in India has increased as a result of a blitz of ads and growing prices for cryptocurrency.
While no official data is available, industry estimates say that the country has 15 million to 20 million crypto investors, with the total crypto holdings being around 450 billion Indian rupees ($6 billion).
Reports quoting from the draft summary of the bill and information from sources, the government now intends to crack down hard on marketing aimed at luring new investors.
Self-custodial wallets, which allow consumers to keep digital currencies outside of exchanges, are also likely to be prohibited, according to the reports.
The harsh new laws are the result of the central bank's serious worries about digital currencies, and they aim to put protections in place to protect the traditional financial industry from cryptocurrencies, according to the bill's draft draught summary.
According to the draft summary, the Securities and Exchange Board of India (SEBI) would be the regulator for crypto assets.