Cryptocurrency prohibition may lead to increased illegal use : BACC

BACC's declaration comes only days after the government announced that a law to ban all private cryptocurrencies, with few exceptions, would be introduced in Parliament.

According to the Blockchain and Crypto Assets Council (BACC), which is part of the Internet and Mobile Association of India (IAMAI), a blanket ban on cryptocurrencies will promote non-state players, leading to increased illegal use of such currencies.

BACC’s declaration comes only days after the government announced that the law to ban all private cryptocurrencies, with few exceptions, would be introduced in Parliament.

In a statement, IAMAI stated that a prohibition would have various negative consequences, including zero accountability and traceability of the origin and end-use of cryptocurrencies, as well as complete tax evasion.

A ban will also have a negative impact on retail investors, according to the report.

According to the statement, the Council has long advocated in favor of making private cryptocurrencies illegal to use as currency in India since their use as a currency is likely to interfere with monetary policy and fiscal regulations.

The Council, on the other hand, has argued for their usage only as an asset.

According to the Council, a smartly regulated crypto assets company will protect investors, help monitor Indian buyers and sellers, lead to improved industry taxation and restrict unlawful crypto usage.

Crypto exchanges established in India offer an effective instrument of monitoring and are dedicated to developing an environment that assures investor protection by bringing both the investors and exchanges under correct tax regulations, the statement said.

The Council thinks that the exchanges’ efforts should be supported by legislation that allows them to provide safer services to investors while also paying fair taxes to the government.

The ‘Cryptocurrency and Regulation of Official Digital Currency Bill, 2021,’ which will be introduced in Parliament’s winter session beginning November 29, aims to regulate cryptocurrency “create a framework that will make it easier for the Reserve Bank of India to create an official digital currency.

The measure also aims to outlaw all private cryptocurrencies in India, but it makes exceptions to encourage cryptocurrency’s core technology and applications “..

CoinDCX, WazirX, and Coinswitch Kuber are among the crypto exchanges represented by the Blockchain and Crypto Assets Council (BACC), which comprises companies like CoinDCX, WazirX, and Coinswitch Kuber.