Bitcoin is not a legal currency in India, clarifies FM amid crypto ban FUD

Key Takeaways

• India’s Finance Minister Nirmala Sitharaman has claimed the government does not collect data on Bitcoin transactions.
• The minister further clarified to the Parliament that they have no plans to recognize Bitcoin as legal currency.
• The Monsoon Session of the Parliament has begun, with the Cryptocurrency Regulations Bill on the agenda.

YEREVAN (CoinChapter.com) – Indian Finance Minister Nirmala Sitharaman has claimed the Government does not collect data on Bitcoin (BTC) transactions. The Minister also confirmed that the ruling party would not recognize the flagship digital asset as a legal tender in India. 

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Indian parliament to discuss Bitcoin (BTC) and crypto regulations

The winter session of the Indian Parliament kicked off on Monday, creating much buzz in the Indian cryptocurrency circles. All eyes are on the ongoing debates in the Lok Sabha (People’s House). Elected lawmakers are set to decide the faith of Bitcoin (BTC)-led cryptocurrencies in the country. 

According to the official Parliament bulletin circulated last week, the Indian Government will introduce a crypto bill in the Lower House of the Assembly in the ongoing winter session deliberations. The Finance Ministry will table “The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021” for the Parliament’s approval.

“To create a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India. The Bill also seeks to prohibit all private cryptocurrencies in India, however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses,”

the bulletin reads.

The circular had resulted in a bloodbath in the Indian cryptocurrency market. All major tokens, including Bitcoin, dipped 20% within hours of the circular’s publication.

The finance ministry also confirmed that the Reserve Bank of India was introducing its version of digital currency. The Apex Bank had sent a proposal in Oct to amend the Reserve Bank of India Act. The amendment aims to enhance the scope of the definition of a banknote. This amendment would allow the RBI to include currency in digital form within the definition.

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Indian Finance Minister disapproves of a crypto ban

Despite the FUD created by India’s crypto uncertainty, previous comments by Indian officials give hope. 

Prime Minister Narendra Modi’s recent mention of Bitcoin and cryptocurrency in his Sydney Dialogue welcomed development. Moreover, Jayant Sinha, the Chairman of the Standing Committee on Finance of the Indian Parliament, also approved plans to harness “the force of this crypto technology and enable it for our domestic users in an appropriate, balanced way.”

However, most importantly, cryptocurrencies got a nod from Finance Minister Nirmalan Sitaraman herself. Back in March, the Minister assured that her party does not plan to crack down on crypto. 

“From our side, we are very clear that we are not shutting all options. We will allow certain windows for people to do experiments on blockchain, bitcoins or cryptocurrency,”  

she assured.

As the Indian Parliament sets the stage for the nail-biting debate, the exact outcome is still unclear. However, it has become almost evident that the Government will not ban Bitcoin (BTC). Neither will it make Bitcoin legal currency. The outcome lies somewhere in between the two extremes.