India’s anti-bitcoin lawmakers have proposed a law that prohibits citizens from possessing, trading or profiting from bitcoin-related ventures which include mining. The “Banning Cryptocurrencies and Regulation of Official Digital Currency Bill 2019” proposes that persons found to be dealing in cryptocurrencies face an unbailable 10 years behind bars.
A couple of government anti-money laundering agencies such as the Central Board of Indirect Taxes and Customs (CBIC) and Income Tax Departments reportedly support the yet to be legislated policy which is set to boost the fight against the scourge.
Economic Affairs Secretary Subhash Chandra Garg, a long-time anti-crypto crusader heads the panel tasked with drafting the bill. Back in December 2017 when bitcoin’s value was at its apex, he declared that the coin would not qualify as legal tender in India.
If the proposed bill is passed into law, crypto holders will be required to declare their asset holdings within 90 days and dispose of them through means prescribed by the central government. The draft also proposes a penalty that is three times the estimated losses to the country’s financial system or direct gains from holdings.
It certainly seems that Prime Minister Narendra Modi’s government will continue to uphold its past anti-crypto stance and impose broader and more stringent penalties on users and companies.
The Reserve Bank of India Denies Involvement
There have been reports that India’s central bank, the Reserve Bank of India (RBI), had a hand in the new proposal, but the institution has officially denied that it has been in communication with the drafting committee.
The rumors stem from the bank’s past efforts to stifle the crypto industry. Last year, the RBI issued a directive to regulated financial institutions prohibiting them from dealing with crypto trading entities which included exchanges and individuals.
The move caused many affected companies to go under. One of the country’s best-funded exchanges, Unocoin, recently announced that it only had a few months worth of reserves left due to limited liquidity caused by the embargo.
India’s Supreme Court was initially set to make a ruling on the matter in March but postponed it to July. The delay and mounting tension sparked a spate of protests across the country.
Despite the frightful development, some Indian crypto industry experts believe that the law will have a limited effect on major players. There are reports that many of them shifted asset holdings to overseas markets as soon as the draft bill was announced.
The Indian crypto community presently faces serious hurdles when attempting to exchange cryptocurrencies for fiat within the country and many users now rely on foreign withdrawal services, relatives and brokers to convert funds. Money is usually sent via MoneyGram, Western Union, PayPal, and direct deposit.
John McAfee Calls Upon Anonymous
Some crypto celebrities including John McAfee have publicly lambasted the Indian government for trying to ban digital coins exclaiming that such a law would directly infringe upon the freedom of its citizens. Through a now-deleted tweet, he recently went beyond his usual rhetoric and appealed to the Anonymous hacker group to support the cause invoking it to “step up to the plate”.
The self-proclaimed crypto madman and battler has been lamenting the increased regulation of cryptocurrencies, referring to them as powerful tools that can be used to free the masses.
Binance CEO Predicts That the Bitcoin Ban Will PUMP Privacy-Centric Coins
Their privacy-rich features allow users to obfuscate addresses involved in transactions, the amount transacted and the memo registered on the blockchain via encryption.
It is likely that the coins and their ilk will flourish in the Indian market and displace bitcoin as the cryptocurrency of choice when executing trades.
(Featured Image Credit: Pixabay)
Author: Elizabeth Gail
CoinCentral is an independent publication covering news and information on cryptocurrencies such as Bitcoin, Ethereum and their underlying blockchain technology.
Source link: India Looks to Impose Harsh Crypto Legislation, Market Shift Expected