A governmental committee in India is in favor of legalizing cryptocurrencies according to a report by The New Indian Express (TNIE). Currently holding cryptocurrencies like Bitcoin and Ethereum is banned in India; however, this could be set to change with this new support.
A senior official who was attending the second interdisciplinary meeting told TNIE that:
“We have already had two meetings. There is a general consensus that cryptocurrency cannot be dismissed as completely illegal. It needs to be legalised with strong riders. Deliberations are on. We will have more clarity soon,”
The report states that the committee has already had two meetings on the issue and will likely submit a report to the finance ministry by February 2019.
India’s Cryptocurrency Ban
This second interdisciplinary meeting outcome comes in stark contrast to the first. The first interdisciplinary meeting was set up in March 2017, and a complete ban on cryptocurrency in the country with immediate effect was recommended.
A circular by the Reserve Bank of India (RBI) rendered cryptocurrencies illegal soon after. This was followed by the Finance Ministry in December 2017 and the Finance Minister in his budget speech in February 2018 echoing an equally harsh line.
However, since the ban has been in place, various stakeholders in the cryptocurrency industry have challenged the RBI and took the case to the Supreme Court. Due to conflicting opinions, the Indian government decided to set up the second inter-ministerial committee led by Subhash Chandra Garg, who is the Department of Economic Affairs secretary.
Another factor that could be influencing the future of cryptocurrencies in India is the recent agreement among G20 countries to introduce crypto regulations to prevent financial terrorism and money laundering.
Members of the second interdisciplinary committee participated in the G20 group meetings and are expected to use the insights they gained from the G20 in their upcoming report.
They also stated that they have taken input from, “cryptocurrency exchanges and experts and will be examining legal issues with the law ministry. It’s a complicated issue. Once all aspects are decided, then we will have more clarity.”
Circumventing the Ban in India
Since the ban has been in place, India crypto users and stakeholders in the industry have come up with novel ways of circumventing it. There has been an emergence of peer-to-peer cryptocurrency exchanges which enable users to trade cryptocurrencies with each other directly while the exchange provides an escrow service without needing support from an Indian bank.
Another step crypto enthusiasts in India have taken is to hide their identities from authorities by using privacy coins like Monero and a VPN service to encrypt their Internet traffic. A VPN allows users to safely access a crypto exchange based overseas that offers its services to Indian customers while privacy coins ensure their crypto transactions cannot be traced back to them. Using a quality and reputable VPN is paramount to ensuring the privacy of the user. However, they do not usually come cheap, so look for VPN discounts on the internet before you subscribe.