9 Oct, 2019

On Cryptocurrencies, Indian Government Continues to Play ‘Will They, Won’t They’

The Indian government since long has played a game of ‘will they, won’t they’ with the Indian cryptocurrency community. While on one hand, the cryptocurrency community is eagerly waiting for a judgement from the highest court in the land, on the other hand, the government appears to be dragging its feet on the regulations draft that was purportedly supposed to have been ready sometime last year.

Naimish Sanghvi, the founder of Coincrunch, compiled the list of questions that had been asked on cryptocurrencies in the Lok Sabha as well as Rajya Sabha in the past couple of years.

For instance, the biggest concern that the government, especially the Finance Ministry has regarding bitcoin is the growth of terrorism via means of bitcoin. A question asked in Rajya Sabha was, “Whether Bitcoins are being used widely for terror funding, money laundering, drug peddling and criminal activities after demonetisation”, and the answer provided said, “There is no credible inputs to indicate that Bitcoins are being used by terrorists and drug syndicates.”

Tagging people so they can check it out themselves@aheli_aheli @NischalShetty @startupkesari @atiprashant @cryptokanoon @Nupursays @murali_anand @pushpendrakum @Shivfreespirit @DesiCryptoHodlr

— Naimish Sanghvi (@ThatNaimish) January 30, 2019

Another eye-opening revelation was the stance of the Indian government on cryptocurrency mining. While, mining itself is not illegal, the government has different ideas. In April 2017 a question was asked in the Lok Sabha on bitcoin mining. At the time, the answer given was, ” The creation, trading or usage of VCs including Bitcoins, as a medium of payment is not authorized by any central bank or monetary authority.”

In March last year, a question pertaining to losses incurred due to trading in cryptocurrencies was asked. At the time, the answer said, “No specific complaint from any investor suffering crores of rupees of loss in bitcoin trade has been received.”

As people would recollect, shortly after this, the news of GainBitcoin founder, Amit Bhardwaj getting arrested in Bangkok made headlines. While Bhardwaj has been accused of scamming thousands of people, his case does not seem to attract much attention from the government, despite numerous media reports.

However a disheartening response in this thread was when it emerged that so far there has been no decision taken on whether the powers that be intend on making the content of the Interdisciplinary Committee public.

Earlier this month, Bharatiya Janta Party (BJP) MP Varun Gandhi had also asked the status of cryptocurrencies in India. At the time, the government had refrained from providing any definitive response.