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Panel report on cryptocurrency ban under government consideration

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The Narendra Modi government on Monday said it is still considering Inter-Ministerial Committee report on banning of cryptocurrency and authorising the digital currency of Reserve Bank of India.

Panel report on cryptocurrency ban under government consideration
The union finance ministry in the Lok Sabha on Monday said the Narendra Modi government is still considering former finance secretary Subhash Chandra Garg headed Inter-Ministerial Committee (IMC) report on banning of cryptocurrency and authorising the digital currency of Reserve Bank of India (RBI).
Also, the government will take a call on whether a new law will need to be brought to Parliament.
In a written reply, the finance ministry stated, "The government would take a decision on the recommendations of the IMC and the legislative proposal, if any, would be introduced in the Parliament following the due process."
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The ministry said, "The high-level panel recommended in its report that all private cryptocurrencies, except any cryptocurrency issued by the state, be prohibited in India."
The government quoted from the 2018-2019 Budget, "It was announced in the Budget Speech for 2018-19 that the government does not consider crypto-currencies legal tender or coin and will take all measures to eliminate the use of these crypto-assets in financing illegitimate activities or as part of the payment system. The government will explore the use of blockchain technology proactively for ushering in the digital economy."
Meanwhile, RBI awaits legal clarity from the government as it has expressed its desire to launch its digital currency, which will need legislative backing from the government.
The government had constituted an inter-ministerial committee (IMC) on November 2, 2017, under the chairmanship of the economic affairs secretary, with the secretary of the Ministry of Electronics and Information Technology, Sebi chairman, and an RBI deputy governor as members to study the issues related to virtual currencies, and propose specific action.
"As for private cryptocurrencies, given the risks associated with them and volatility in their prices, the group has recommended the banning of the cryptocurrencies in India and imposing fines and penalties for carrying on of any activities connected with cryptocurrencies in India," said a release in this regard.
The report said that other than Bitcoin, several other cryptocurrencies have emerged, including Ethereum, Ripple and Cardano. As of now, there are around 2,116 cryptocurrencies, with a market capitalisation of $119.46 billion, it added.