The Centre intends to present the Cryptocurrency and Regulation of Official Digital Currency Bill 2021 in the Parliament’s winter session to regulate cryptocurrency. The bill will be introduced during the winter session, which begins today, November 29. Along with 25 other pieces of legislation, it will seek to officially prohibit all private cryptocurrencies.
The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, which is still awaiting Cabinet approval, aims to create a favourable framework for the formation of the Reserve Bank of India’s (RBI) official digital currency.
The Bill also seeks to prohibit the use of private cryptocurrencies in India. However, certain exclusions will be permitted in order to promote the underlying technology of cryptocurrency and its applications.’ the description of the accessed government document reads.
India is regarded as having one of the world’s largest cryptocurrency markets. According to a recent survey, India has more than 10 crore cryptocurrency owners. According to homegrown crypto exchange sites, approximately 2 crore Indians have invested in cryptocurrency.
Ripple, Bitcoin, Ethereum, and other well-known cryptocurrencies may not be prohibited. In fact, despite attempts to draught a new Crypto bill, they are very likely to continue to exist in India. On Tuesday evening, the government announced a list of 26 laws that will be tabled in parliament soon. The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 was included on this list. According to the bill, all private cryptocurrencies should be banned in order to make room for the RBI’s digital currency.
Most cryptocurrencies began to bleed on Tuesday night as a result of investor nervousness. Some of the investors must have been forced to withdraw their funds as a result of the panic. Bitcoin, Ethereum, and nearly all other significant cryptocurrencies experienced a drop. Despite this, according to the most basic technical definition, none of them should be prohibited. All of these are public cryptocurrencies, and the design allows for the connecting and tracing of transactions.
What Is Private Cryptocurrency?
The next natural question that should come to mind is, “What is a private cryptocurrency?” These are the coins that allow for anonymous blockchain transactions. In a nutshell, these conceal a user’s true wallet balance and address, and they frequently mix numerous transactions to thwart chain analysis.
The issue with these private coins is their anonymity and untraceability. To conceal the identity behind a transaction, while untraceability makes it difficult for third parties to follow up on transaction trails. There have also been concerns about unlawful transactions with these coins.
Some problematic coins, such as Monero and Dash, enabled its users to receive and send value anonymously, which helped them become extremely popular. Many other private coins have emerged since then.
India will not be the first country to take significant action against private cryptocurrencies. South Korea has banned the trade of private currencies on the country’s cryptocurrency exchanges in order to combat money laundering. The United States has yet to enact legislation prohibiting the use of private coinage. It has, however, developed methods to eliminate the privacy of transactions that take place via private networks.