Government documents from 2019 were cited by an Indian crypto expert to suggest that the proposed ban on all “private cryptocurrencies” could include just about all crypto.
The Indian government announced this week that it will introduce the Cryptocurrency and Official Digital Currency Regulation Bill, 2021 during its winter session on November 29.
The bill calls for a legislative vote on the creation of an official digital currency while banning “all private cryptocurrencies”. However, there seems to be a lot of confusion regarding what exactly constitutes “private cryptocurrency”, with some users speculating that it could refer to “privacy” coins such as Monero or Zcash.
The founder of crypto news site CoinCrunch India, Naimish Sanghvi, explained in a November 25 interview on India Upfront that, according to the government’s definition, private crypto could mean just about any cryptocurrency in existence. He said:
“In the 2019 Department of Economics Cryptocurrency report, they basically said anything that is not sovereign is referred to as private cryptocurrency.”
“And by that logic, that means Bitcoin and Ethereum will fit into that definition,” he said, adding that “anything that is issued by the government is public and anything that is issued by private players is public. “.
Looks like all cryptocurrencies are going to be banned in India. Some people have taken private cryptocurrencies to mean Monero, ZCash, etc. This is not the case. They all mean. https://t.co/Bx4dyX5M0u
– ciarán.eth (@ C1aranMurray) November 24, 2021
The 2019 report in question recommended that “all private cryptocurrencies, except any cryptocurrency that may be issued by the government, be banned in India.” He stated:
“All of these cryptocurrencies were created by non-sovereigns and in this sense are completely private companies.”
But the marketing director of Indian crypto exchange WazirX Rohit Kundliwal called for calm and downplayed fears of an outright ban.
Yesterday in a post on Linkedin, Kundliwal pointed out that crypto cannot be banned, only regulated, and that there is no clarity on what constitutes private cryptocurrency.
He added that “Shri Narendra Modi, Nirmala Sitaraman, the Ministry of Finance and many prominent and sane politicians have repeatedly said that there will be no blanket ban on crypto.”
Meanwhile, Indian Shiv Sena MP Priyanka Vickram Chaturvedi said on November 24 maintenance with India Today that the proposed ban is a “step back and a little too late”. She said:
“The ban on private cryptocurrencies fundamentally ends the very idea of a new fintech that can become a huge job and generator for the new economy.”
She said the government must “facilitate a changing and prosperous environment. The impact of doing that … is that you kill all that space.
Related: India to cut GST paid on crypto exchange fees from 18% to 1%
The market reacted dramatically to the announcement of a possible ban, with prices for Indian crypto exchange WazirX crashing Wednesday morning at 3.30am UTC as users rushed to sell their holdings. The panic sell event caused the price of Bitcoin (BTC), Ether (ETH) and Cardano (ADA) to fall in a double-digit local price depreciation.
On November 18, Indian Prime Minister Narendra Modi called on all democratic nations to work together to regulate cryptocurrency, especially Bitcoin, “to make sure it does not fall into the wrong hands, which could spoil our youth “.