India To Present Draft Regulations On Cryptocurrencies Next Month

News, Regulation | November 21, 2018 By:

The government of India is reportedly set to released its much awaited draft bill on crypto regulation next month.

Last month, the Indian Supreme Court held a hearing on petitions filed by crypto exchanges who took the legal route to fight the crypto banking ban imposed by the Reserve Bank of India in April of this year. During the hearing, the court asked the government to officially clarify its position on cryptocurrencies.

On November 19, the Narendra Modi government filed a counter-affidavit in the supreme court, saying that a finance ministry panel, set up in November 2017 and headed by secretary in the department of economic affairs Subhash Chandra Garg, could be ready with draft regulations in December, according to documents obtained by Quartz India.

“Currently, serious efforts are going on for preparation of the draft report and the draft bill on virtual currencies, use of distributed ledger technology in (the) financial system and framework for digital currency in India,” the government’s counter-affidavit said. “The draft report and bill will be circulated to members of IMC (inter-ministerial committee). Thereafter the next meeting of IMC will be held so that discussion can take place on the draft report and bill. It is expected that the draft report will be placed before the IMC by next month.”

The finance ministry panel’s next two meetings are scheduled to be held next month and in January 2019. During these meetings, the panel will deliberate the draft report, and the provisions of the draft bill on cryptocurrencies.

In June of this year, Garg said that he recognized that some people may still find value in cryptocurrencies and that would require introducing certain regulations so that crypto transactions are legal and transparent. He added that the upcoming regulations would introduce legal requirements for know your customer (KYC) procedures and record keeping for transactions.