India Might use Cryptocurrencies as a Commodity Rather than Banning Them

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People have seen Cryptocurrency Regulation fights that have been happening since years in India. But, recently, the Reserve bank of India announced that they would be accepting cryptocurrencies, and the matter was warm. But now after some days, a finance ministry committee has started to study them and recommended them for being traded as commodities. According to the reports published by the news outlet Quartz.

A senior government official from the committee stated:

“I don’t think anyone is really thinking of banning it (cryptocurrencies) altogether. The issue here is about regulating the trade, and we need to know where the money is coming from. Allowing it as (a) commodity may let us better regulate trade and so that is being looked at.”

Recently in June 2018, Subhash Chandra Garg, secretary in the department of economic affairs and head of the cryptocurrency board told the television news channel ET, the draft regulations will be covered up in the first fortnight of July.

The head of the committee revealed that the first concern of the board is to keep track of investors and funds to control money laundering and illegal financing.

He said:

“Trade is not a criminal offense. Most of us trade in various asset classes in the stock market. So how is this (cryptocurrency trading) any different? What has to be in place is a mechanism to be sure that the money used is not illegal money, and to track its source is the most important thing.”

An email has been remained unanswered which is sent by the Ministry of Finance.

Another Turn

The first committee was set up by the Narendra Modi government in April 2017 for understanding the growing virtual currency ecosystem suggesting slowly suffering it. Therefore, the second team will come as suffering.

Shubham Yadav, co-founder of Coindelta, a Pune-based cryptocurrency exchange, said:

“Though cryptocurrencies belong to a new class of financial assets, we can still welcome them as commodities and not currencies because of their highly volatile prices. Many countries have been already going in this direction, including the US.”

R Gandhi, a former RBI deputy governor told considering cryptocurrencies as commodities would make it clear for few investors that cryptocurrencies such as bitcoin aren’t real currency.

R Gandhi included:

“If these are used to settle transactions, then it acquires the nature of currency. So that is one thing that one needs to be wary of. But if people want to invest in a commodity, then that is different, because then we can assume that they are aware of the risks involved.”

Mr. Yadav continued stating:

“We are also ready to work with the government and assist them on creating a regulatory framework. We can help them in designing a monitoring system for blockchain where it can remotely monitor all transactions.”

Nishanth Shetty

Nishanth Shetty is a technical writer, author and a crypto-advisor working at Cryptofame. Based in the city of dreams, Mumbai, on the west coast of India. He holds a bachelors degrees from Mangalore University. Nishanth has a myriad experience of technical writings for tech brands. His interests include technology, travel, and food.