India wants to ban all private cryptocurrencies, with a few exceptions, to pave the way for an RBI-controlled digital currency
The government wants to ban all private cryptocurrencies, with a few exceptions, to pave the way for a digital currency controlled by the Reserve Bank of India.
The Cryptocurrency and Official Digital Currency Regulation Bill 2021 is set to be introduced in the Winter Session of Parliament from November 29. It aims to “create a framework facilitating the creation of the official digital currency to be issued by the RBI.”
The bill “seeks to ban all private cryptocurrencies in India, however, it allows certain exceptions to promote the underlying technology of the cryptocurrency and its uses.”
Cryptocurrency prices on local exchanges collapsed overnight after the news broke, even though they remained largely unchanged in global markets.
Governments and regulators remain divided over how to categorize crypto as a currency or asset – and how to control it from an operational standpoint.
El Salvador, for example, approves Bitcoin as legal tender. China imposes strict regulations on both cryptos and service providers.
Countries like India fall somewhere in between – still figuring out how best to regulate cryptos after some policy and regulatory experimentation.
In its Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, Canada defines virtual currency as: (a) a numerical representation of value that can be used for payment or investment purposes that does not is not a fiat currency and can be easily exchanged for funds or another virtual currency that can be easily exchanged for funds; or (b) a private key of a cryptographic system which allows a person or entity to have access to a digital representation of the value referred to in paragraph (a).
A Thomson Reuters Institute report in June of this year noted that Canada was among the early adopters of crypto, and the Canada Revenue Authority generally treats cryptocurrency as a commodity for the purposes of the Act. income tax of the country.
Israel includes virtual currencies in the definition of financial assets. Israel’s securities regulator has ruled cryptocurrency as a matter of security, while Israel’s tax administration defines cryptocurrency as an asset and requires 25% on capital gains.
The German Financial Supervisory Authority qualifies virtual currencies as “units of account” and therefore “financial instruments”. The Bundesbank considers Bitcoin to be a crypto token since it does not perform the typical functions of a currency. However, citizens and legal entities can buy or trade cryptoassets as long as they do so through exchanges and custodians approved by the German Federal Financial Supervisory Authority.
Different US states have different definitions and regulations for cryptocurrencies. Although the federal government does not recognize cryptocurrencies as legal tender, definitions issued by states recognize the decentralized nature of virtual currencies.
Digital asset companies are required to apply for a license, monitor unfair trading practices and are considered “financial institutions” for anti-money laundering and other purposes, according to Thomson Reuters Institute report . Earlier this month, Thailand’s oldest lender, Siam Commercial Bank, announced plans to buy a 51% stake in local cryptocurrency exchange Bitkub Online.