The Reserve Bank of India (RBI) has advised the government to enact laws and bans regarding cryptocurrencies.
However, according to Finance Minister Nirmala Sitharaman’s comments in Parliament on July 18, the administration appears to believe that any successful regulation or ban requires global collaboration.
All eyes are on the government’s draught crypto consultation document even before the aforementioned bill is introduced. In late May, it was reported that the paper, which is expected to clarify the government’s position on cryptocurrencies, was nearly finished. It is still awaiting, nevertheless.
The RBI has continued to develop its own digital money, which it wants to launch this year, while legislation on cryptocurrencies is still pending.
The government has so far refused to publicly state where it stands on cryptocurrencies, and there is even debate over how to classify them—whether they should be classified as commodities or financial assets. Instead, Sitharaman and Prime Minister Narendra Modi have advocated for concerted international action to address the issues brought on by the use of cryptocurrencies in recent months.
RBI believes that it should be illegal to use cryptocurrency. She continued by saying that because cryptocurrencies are by definition international in nature, international cooperation is necessary to prevent regulatory arbitrage.