The Crypto Asset Bill proposes to prohibit the use of cryptocurrency as a medium of exchange
The crypto bill, which will be introduced in the Parliament's winter session, aims to create a legislative framework for the rapidly developing crypto market.
The Crypto Asset Bill intends to make it illegal to use crypto assets as currency replacements or as remittance payment systems. According to NDTV, the bill also proposes to create a regulatory framework for distributed ledger technology and lays the basis for the formation of an official digital currency to be issued by the Reserve Bank of India (RBI) and controlled under the RBI Act.
In accordance with the worldwide approach, the bill, which will be introduced in Parliament’s winter session, also wants to build a legislative framework to regulate the evolving sector and to prevent ads and the transmission of misinformation to the public.
The bill aims to reduce the danger of financial instability by properly separating the regular financial system from crypto assets.
Because the technology that underpins crypto assets is continually growing and has a wide range of applications, the bill provides an exception for anybody who uses the technology that underpins any Crypto asset for any lawful purpose.
The measure gives the government the authority to exempt certain operations in the public interest, such as crypto mining, producing holdings, selling dealing in issuance transfer, disposing of, or using it as a medium of exchange, store of value, or unit of account.
Individuals and corporate bodies will face penalties if they violate the bill’s requirements, and the offences will be cognizable and non-bailable. The RBI would be in charge of currency regulation, while market regulator SEBI will be in charge of digital assets.
According to reports, the reason for bringing the bill to regulate crypto assets is that it may represent a threat to financial stability and there is now no regulation in place to address it. The law also proposes that all private cryptocurrencies be banned in India and that regulation be made easier.