Cryptocurrency is not legally valid in India but it is not illegal either. The central government has taken a big step to take care of the interests of those who put money in it. The government is said to be preparing a framework for this.
Cryptocurrency is a digital currency. It has no regulator and till now, no one controls it in any country. Different cryptocurrencies have been in the market since their inception in the year 2009 and their prices have seen a big jump in the recent past.
For a long time, questions have been arising about the future of cryptocurrency. Meanwhile, news is coming that the government may soften its stance on cryptocurrencies. As per sources cited by Zee Business, there may be some relaxation in the complete ban on cryptocurrencies in India. According to information received by Zee Business, government sources said that the definition of cryptocurrency has not been agreed upon by RBI, SEBI.
RBI is not ready to consider cryptocurrency as an asset. At the same time, SEBI also does not consider it a commodity. Actually, the government wants that there should be regulation for those who invest in cryptocurrencies. Work on its framework is also underway. It is being said that RBI and SEBI are together preparing rules related to cryptocurrencies and both will regulate crypto.
The government has to take the final decision on the law on cryptocurrency. But there is no clarity on its framework and how it will be regulated. If sources are to be believed, a law can be brought to regulate it in the Budget 2022. If this happens, those investing in cryptocurrencies will not be in danger of losing their money. Notably, during its monetary policy of August 2021, RBI had indicated that it is also working on its digital currency and its draft may be ready by the end of the year. RBI Governor Shaktikanta Das said that the model of digital currency will come by the end of the year.
Work is underway on the technology and distribution of digital currency. The framework of how this will work is also being prepared. During a webinar of the Vidhi Center for Legal Policy, RBI Deputy Governor T Rabi Shankar said that India also needs digital currency. This will protect against the loss caused by investing in a private virtual currency ie cryptocurrencies like bitcoin. He also said that the RBI is working on it. The apex bank has made it clear that it has conveyed its concerns to the government regarding private virtual currency.