On Tuesday, the Council on financial stability and development (FSDC) of India led by the Finance Minister Arun Jaitley had a scheduled meeting where the matter of decentralized electronic assets emerged.
This council was specially created to work with issues to do with virtual assets/coins and ultimately to come up with a legal basis for prohibiting private crypto coins in India. The press release issued by the Press Information Bureau can be viewed here.
Hold but do not transfer it
The ‘use’ that the press released mentions in the context of crypto could mean that purchase, sales, transaction of crypto or even changing virtual coins into rupees will be banned.
However, that does not necessarily mean that owning Bitcoin and other coins will be prohibited. This opinion was expressed by a local major analytical firm Crypto Kanoon.
U.Today has recently reported a similar court case in China where a judge, working on a case of breaching contractual obligations made a verdict that crypto, transaction of which is banned in the country, is to be treated as economic property and protected by the respective legislation.
Special task force at work
A few reps from the banking sector and regulators were also present at the discussion, including the chief of the crypto panel, the Department of the Economic Affairs secretary.
The panel was formed in early winter last year, when the crypto market reached its historical highs, and was assigned with making up crypto regulation schemes. The group was supposed to submit the rules by mid-summer but the outcome of their work was delayed.
Part of this panel are such officials as the RBI deputy governor and the Securities and Exchange Board of India chairman.
The current situation with RBI
In spring this year, the Reserve Bank of India made an attack against the crypto industry in the country, prohibiting all banks from dealing with exchanges, traders or similar entities.
Crypto exchanges began to use P2P trades, however things got so bad that Zebpay platform, India’s largest one, had to shut down its operations and move out of the country.
Analysts believe that despite everything there around 5-6 mln crypto users in India.
Having been pushed into a tight corner, local crypto exchanges have filed a legal complaint against the RBI in the Supreme Court. The recent hearing occurred on October 26 and the court directed the Indian government to make its position on the issue of digital assets clear within a fortnight.