Crypto prices plummet after Centre's proposal to ban private Cryptocurrencies barring few

The news that the government would introduce a new Bill in the winter session of Parliament to restrict all private cryptocurrencies in India, with a few exceptions to advance the underlying technology of cryptocurrency and its purposes, sent crypto markets into a spiral. As of 11:15 p.m. on November 23, all major cryptocurrencies have dropped by 15% or more, with Bitcoin down over 17%, Ethereum down almost 15%, and Tether down nearly 18%. According to the central government, their agenda is to build a conducive framework for the creation of the official digital currency to be issued by the Reserve Bank of India.

The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, is planned to be introduced in parliament in the forthcoming session, which begins on November 29th, according to an official document on scheduled house procedures. With some exceptions, the Bill will outlaw all private cryptocurrencies in India, and it is scheduled to be taken up for final consideration and passage during the winter session. The Reserve Bank of India will establish its own digital money, according to the government. Investor money security and deceptive media promotions about investment potential and risks have long been a source of concern.

Central Govt. convening number of meetings for digital currency regulation 

The central government has convened a number of discussions with all stakeholders to examine digital currency regulation. On the subject, Prime Minister Narendra Modi convened a high-level conference with officials from various ministries and the Reserve Bank of India. Concerns have been expressed by the Reserve Bank of India and the Securities and Exchange Board of India concerning the unregulated expansion of cryptocurrencies in India, with vulnerable ordinary investors in mind. Previously, there were indications that the government is considering adjustments to income tax regulations to bring cryptocurrencies into the tax net, with certain modifications perhaps being included in the Budget next year.

According to Revenue Secretary Tarun Bajaj, in terms of income tax, some persons are already paying capital gains tax on cryptocurrency income, and in terms of Goods and Services Tax (GST), the law is quite clear that the rate would be the same as for other services. I understand that people are already paying taxes on it. We'll see whether we can truly bring about some changes in legal views now that it's expanded so much. That, however, would be a budget activity. We are already getting close to the Budget, and we need to look at that point in time, Bajaj added.

(With inputs from agencies)

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