India Needs to Assess Crypto Risks Before Deciding Whether to Ban, Minister Says

On Friday, Finance Minister Nirmala Sitharaman said the government is still formulating its opinion on cryptocurrencies.

AccessTimeIconMar 7, 2021 at 2:36 p.m. UTC
Updated Sep 14, 2021 at 12:22 p.m. UTC

India's Minister of State for Finance, Anurag Thakur, said the government needs to study national security risks posed by virtual currencies before making any decision on their legality.

  • "We understand there is immense interest in these virtual currencies, but we also need to look at national security and security of Indians and individuals," Thakur said while addressing an event organized by Entrepreneurs' Organization Punjab on Saturday.
  • Thakur took a jab at the volatility of cryptocurrencies, saying the coins often chart 10x price moves in weeks. "That doesn't happen in fiat currencies" such as the Indian rupee or U.S. dollar, Thakur said.
  • Billionaire investor Rakesh Jhunjhunwala, popularly known as India's Warren Buffett, recently voiced similar concerns, calling bitcoin "speculation of the highest order."
  • The Supreme Court of India overruled the Reserve Bank of India's two-year-old banking ban on cryptocurrencies in March 2020, bringing cheer to the Indian crypto community.
  • The Indian government, however, is now planning to insert a bill into the parliament's ongoing budget session that would ban private cryptocurrencies.
  • The Indian government has formed a high-level Inter-Ministerial Committee to look into cryptocurrency and may present a legislative proposal in Parliament based on the committee's recommendations, Thakur told the Entrepreneurs' Organization, adding that the government welcomes new technology such as blockchain and Prime Minister Narendra Modi is a strong advocate of embracing technology in various aspects of governance.
  • On Friday, Finance Minister Nirmala Sitharaman said the government is still formulating its opinion on cryptocurrencies and will take a calibrated position.

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