An Indian crypto specialist referenced government papers from 2019 to show that the intended ban on all “private cryptocurrencies” might cover nearly all cryptocurrencies.
The Indian government said this week that the Parliament reconvenes on Monday for the Winter Session. Moreover, it would propose the Cryptocurrency and Regulation of Official Digital Currency Bill 2021.
The measure calls for a vote in the legislature on developing an official digital currency and prohibits “all private cryptocurrencies”. However, there appears to be some misunderstanding about what a “private cryptocurrency” is. With some people think that it may relate to “privacy” coins like Monero (XMR) or Zcash (ZEC).
On the other hand, in a Thursday interview on India Upfront, Naimish Sanghvi, the creator of cryptocurrency news website Coin Crunch India, said that per the government’s definition, private crypto may refer to any cryptocurrency. He stated:
“Everything that is non-sovereign is designated as a private cryptocurrency. According to a Department of Economic Affairs study on cryptocurrencies released in 2019.”
“And by that reasoning, Bitcoin and Ethereum will be included in that definition,” he added. “Anything released by the government is public, and everything issued by private actors is public,” he continued.
“All private cryptocurrencies, excluding any coin that maybe issued by the government, should be outlawed in India”. According to the 2019 study. It said:
“All of these cryptocurrencies founded by non-state actors and are thus fully private entities.”
Crypto cannot be illegitimate, just regulated
However, Rohit Kundliwal, marketing manager at WazirX, an Indian crypto exchange, counselled restraint and dismissed worries of an outright ban.
Additionally, Kundliwal said on LinkedIn on Wednesday that crypto cannot be unlawful, just regulated, and that there is no clear definition of what makes a private coin.
“Shri Narendra Modi, Nirmala Sitaraman, the Finance Ministry, and many famous and sensible politicians have repeatedly stated that there will not be a blanket ban on crypto”, he continued.
Meanwhile, in an interview with India Today on Wednesday, Indian Shiv Sena Member of Parliament Priyanka Vickram Chaturvedi said the planned ban is a “step backwards and a little too late”. She expressed herself as follows:
“By prohibiting private cryptocurrencies, the entire concept of a new fintech that may develop as a major source of jobs and revenue for the new economy is effectively dead.”
“Facilitate a developing and vibrant atmosphere,” she remarked. You’re ruining this entire place by doing this”.
As a result, The market responded angrily to the possibility of a ban, with WazirX prices plunging around 3:30 a.m. Furthermore, UTC on Wednesday morning as users hurried to liquidate their holdings. The panic selling incident sent Bitcoin (BTC), Ether (ETH), and Cardano (ADA) prices down by double digits on local markets.
On Nov. 18, Indian Prime Minister Narendra Modi urged all democratic countries to work together to regulate cryptocurrencies, notably Bitcoin. In order to “guarantee it does not wind up in the wrong hands, spoiling our young”.