India’s government will introduce a bill to ban private cryptocurrencies and create a framework for a central bank-backed digital money, parliament said in a shock announcement late Tuesday.
The proposed bill “seeks to prohibit all private cryptocurrencies in India”, the Lok Sabha said, and comes after Prime Minister Narendra Modi warned last week that Bitcoin presents a risk to younger generations and could “spoil our youths” if it ends up “in the wrong hands”.
It is the latest such move by a major emerging economy, after China declared all cryptocurrency transactions illegal in September.
India’s cryptocurrency market has boomed since the country’s Supreme Court overturned a previous ban in April last year, growing more than 600 percent over the past year according to research by Chainalysis.
Although the Diaspora’s central bank announced in June that it was getting ready to introduce its own virtual currency by the end of the year, it also voiced “serious concerns” regarding private cryptocurrencies like Ethereum, Bitcoin, and others.
As per the planned business calendar of the parliament, the legislation aims to promote bitcoin technology by permitting restricted exclusions. The draft legislation has not been made public in any other way, although it is anticipated to come before the next legislative session.
The market price of Bitcoin was up 1.67 percent in Tuesday’s transaction, seemingly unaffected.
However, the draft bill’s wording alarmed the neighborhood’s traders and aficionados.
“The wording has created a panic,” stated Kashif Raza, the creator of the Bitinning crypto-education platform. He also mentioned that the industry was expecting the government to adopt a more lenient stance following recent meetings with the sector.
“Obviously there will be a shutter-down on the industry,” he stated. “The sector will pass away naturally. Investors will lose money, and intellectual capital will depart.
Also Read: Bitcoin has fallen nearly 50% from its highs during the year
