After months of uncertainty, there are indications that India may not, after all, opt for a blanket ban on virtual currencies. A finance ministry panel set up to study them may even suggest that they be treated as commodities.
“I don’t think anyone is really thinking of banning it (cryptocurrencies) altogether. The issue here is about regulating the trade and we need to know where the money is coming from. Allowing it as (a) commodity may let us better regulate trade and so that is being looked at,” a senior government official privy to the panel’s discussions told Quartz, requesting anonymity.
Last month, Subhash Chandra Garg, secretary in the department of economic affairs and head of the cryptocurrency panel, told television news channel ET Now that the draft regulations are likely to be wrapped up in the first fortnight of July. Set up in December 2017, this task force includes BP Kanungo, deputy governor of the Reserve Bank of India (RBI), and Ajay Tyagi, chairman of market regulator Securities and Exchange Board of India.
The committee’s most important concern is keeping track of investors and funds to curb money laundering and illegitimate financing, the official said.
“Trade is not a criminal offence. Most of us trade in various asset classes in the stock market. So how is this (cryptocurrency trading) any different? What has to be in place is a mechanism to be sure that the money used is not illegal money, and to track its source is the most important thing,” the official said.
An email sent to the ministry of finance remained unanswered.