The Finance Ministry on Monday said it had no plan to boost the cryptocurrency sector, in response to a question in the Lok Sabha.
“Currently, cryptocurrencies are unregulated in India. The government does not collect data on the cryptocurrency sector,” Minister of State for Finance Pankaj Chaudhary said.
The Finance Minister had been asked whether the government had plans to boost the sector, and if it had data for the active cryptocurrency exchanges in the country, as well as details on cyberattacks on these companies. Further questions were on details of how big the cryptocurrency market was and how much employment it generated, and how trustable cryptocurrencies were and whether it was possible for the government to regulate the market
A “Bill on Cryptocurrency and Regulation of Official Digital Currency” bill would be taken up during the seventeenth session, the finance ministry said in its reply.
In response to a question by Rakesh Singh on the government’s plans to start a digital currency, the MoS clarified that a Central Bank Digital Currency (CBDC) is introduced by a central bank.
It said the Reserve Bank of India had submitted a proposal in October to amend the RBI Act of 1934 to enhance the scope of the definition of bank note to include currency in digital form.
“RBI has been examining use cases and working out a phased implementation strategy for introduction of CBDC with little or no disruption,” it said.
“Introduction of CBDC has the potential to provide significant benefits, such as reduced dependency on cash, higher seigniorage due to lower transaction costs, reduced settlement risk. Introduction of CBDC would also possibly lead to a more robust, efficient, trusted, regulated and legal tender-based payments option. There are also associated risks which need to be carefully evaluated against the potential benefits.”
“As CBDC is backed by the Central Bank of a country, apart from other benefits, it will not have volatility which is normally associated with the private cryptocurrencies.”
