Even as the government is gearing up to introduce a bill to regulate all cryptocurrencies, in the upcoming winter session of Parliament, there is much buzz and activity among crypto industry players in the country.
The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, which will be tabled in Parliament, aims to create a framework for an official digital currency to be issued by the Reserve Bank of India (RBI). While some industry players feel that it is a wait and watch situation as there is not much clarity on the issue, a few have welcomed the move.
However, the majority of them are against a blanket ban.
“There is no point in speculating about the bill. We should rather wait to see the details of the bill. A lot of things are unclear; for instance we do not know what the bill means when it talks about 'private cryptocurrencies'. So, the ideal thing to do is to wait for the details of the bill to come out and then act accordingly,” said Manan Vora, member of Blockchain and Crypto Assets Council (BACC) and vice president, operations and strategy, at Liminal.
Some feel that the government has been constantly trying to learn and understand the whole crypto ecosystem and things would become clear only when the finer prints of the bill are released. “We are awaiting further details on the bill that is going to be presented in the winter session of the Parliament. There have been many positive steps taken by the government to learn and understand crypto and its impact on all stakeholders— investors, exchanges, and policymakers. So, we are looking forward to a crypto bill that takes into consideration all the inputs from those discussions,” said Avinash Shekhar, member of Blockchain and Crypto Assets Council (BACC), and Co-CEO of ZebPay.
Players, however, maintain that though further clarity on the bill is awaited, a complete ban will be against the crypto industry in India. “Introduction of official central digital currency is a welcome move and will bring in lots of innovations and remove a lot of inefficiencies. However, there should not be a blanket ban on cryptocurrencies, and Indians should be able to invest in the global blockchain innovations happening across the globe,” observed Bhagaban Behera, member of Blockchain and Crypto Assets Council (BACC) and co-founder and CEO of Defy.
Experts point out that there is a lot of speculation around the term ‘private cryptocurrencies’ and what comprises it. These will be put to rest once the fine print of the bill is out. “We have been engaging with the government and regulatory authorities, and they have been open and inclusive. In fact, the statement by our finance minister on adopting a calibrated approach towards regulating crypto, earlier this year, was a significant move in the positive direction for the industry. Cryptocurrency, without a doubt, is the biggest tech revolution after the internet and it has immense potential to build powerful use-cases that can eventually revolutionise multiple industries,” pointed out Gaurav Dahake, CEO and founder, Bitbns.
Dahake said many countries have already identified the potential of crypto currencies which is why they have been regulated across leading economies such as the US, UK, Singapore, and Japan among others. “With India now hosting the largest number of cryptocurrency investors in the world, it is just a matter of time for the government to adopt smart regulations for the sector. Well-appraised regulations and a more defined framework will not just help in structured adoption but will also aid in putting a tight check on unregulated crypto markets that has been a concern for the regulatory authorities.”
Experts also note that the industry players have been actively communicating with all stakeholders, keeping investor protection at the forefront and their discussions, over the last few weeks. This indicate that there is broad agreement on ensuring customers are protected, financial system stability is reinforced and India is able to take advantage of the crypto technology revolution.
“The crypto industry is hopeful that the government will involve the industry stakeholders while drafting the bill. We shall follow the directions provided by the government. As of now, I urge all crypto asset investors in the country to remain calm, do their own research before arriving at a rushed conclusion. Investors should wait for a government statement on this matter and not rely on secondary sources of information,” said Ashish Singhal, founder and CEO, CoinSwitch Kuber, and co-chair of the Blockchain and Crypto Assets Council (BACC).
A few industry stakeholders also feel that the introduction of the bill is a big moment for India. “From a banking ban in 2018 to listing the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, in the Parliament's winter session, our nation has come a long way in these three years. It speaks volumes about how India is determined to dominate the web 3.0 era. While the description of the draft bill appears to be the same as in January 2021, several noteworthy events have occurred since January. First, the parliamentary standing committee invited a public consultation, and then the prime minister himself came forward to call for crypto regulations in India. That being said, let us respectfully wait to find out more about the draft bill to be tabled in the Parliament,” said Nischal Shetty, founder,WazirX.
