The Parliamentary Standing Committee on Finance is debating draught legislation on cryptocurrency centered on national security concerns. Terror financing through crypto instruments and domestic security threats, according to the chairman of the Parliamentary committee, are legitimate concerns.
“What happens to these crypto assets and cryptocurrencies must be closely monitored. “We want to be wary of the use of these kinds of crypto instruments in terror financing and for internal security threats,” Parliamentary Standing Committee on Finance head Jayant Sinha told Bloomberg.
Sinha went on to say that because India lacks full capital account convertibility, it is impossible to replicate industrialized economies using virtual currencies.
He went on to say that given India’s unique situation, the country’s approach to cryptocurrencies will have to be unique. “Because of our circumstances, our answer will have to be original and unique. We must strike a balance between stability and growth, but we recognize the importance of the crypto space as a whole,” Sinha said.
Last month, Finance Minister Nirmala Sitharaman stated that proposed cryptocurrency legislation is currently before the Cabinet. The report from the inter-ministerial committee on cryptocurrencies, which looked at concerns surrounding virtual currencies and proposed specific steps, has already been filed. According to the panel, all private cryptocurrencies should be forbidden across India, except for any virtual currencies in the state.
Meanwhile, the RBI has expressed its concerns about the market for cryptocurrencies to the government. The commitment of the government and the central bank to financial stability was emphasized by RBI Governor Shaktikanta Das, who stated that there are no divisions between the RBI and the Finance Ministry on the subject. Das continued, “We should now await the Centre’s ultimate conclusion on the subject.”
