E-Paper
Cyber law expert files PIL in Calcutta HC seeking state regulation on Bitcoin
The PIL was filed three days after Union finance minister Arun Jaitley told the Rajya Sabha that there is no mechanism to prevent the misuse of cryptocurrencies such as Bitcoin.
A cyber law expert has filed a public interest litigation (PIL) in the Calcutta high court seeking regulation by the Centre and state against crypto currencies, especially Bitcoin.
“This is a gigantic ponzi scam but our government agencies are sitting in the gallery and watching it unfold. People need to be protected and agencies that fight economic offences need to be proactive,” said Bivas Chatterjee, the cyber law expert.
Bitcoin is a decentralised virtual currency that allows monetary transaction around the world without involving any bank. The money can be used to purchase goods and services, even those that are not legal.
In his petition, Chatterjee cited examples of how Bitcoins were exchanged for cash in Kolkata. The court is yet to fix a date for the hearing.
The PIL filed on January 5 says a Narcotics Control Bureau of India (NCBI) report in 2015 mentioned the first instances of drug cartels using Bitcoins. The petitioner alleged that various investigating agencies are struggling to identify the money trails in crimes in which the accused used Bitcoins.
“Even terrorists are suspected to be using more and more crypto-currency because they think it is difficult for law enforcement and investigating agencies to trace the money trail,” said the petitioner.
He has sought response from the Reserve Bank of India, Union finance ministry, Securities and Exchange Board of India (SEBI), income tax department, enforcement directorate, West Bengal government and the state information, technology and electronics department.
“In the absence of any statutory regulation, people are investing in crypto-currencies especially in Bitcoins with the hope that their investments will multiply manifold within a short time. If the value of crypto-currencies collapse there can be economic chaos,” the petitioner alleged.
A similar PIL was filed in the Supreme Court in November following which the apex court sought response from the Centre, RBI and SEBI.
Incidentally, in 2013 the RBI had warned people against using Bitcoins. In 2017, it issued another public notice. “The RBI had cautioned the users, holders and traders of Virtual Currencies (VCs), including Bitcoins, about the potential financial, operational, legal, customer protection and security related risks that they are exposing themselves to,” the notice in 2017 said.
The petition filed by Chatterjee alleged that crucial government agencies have kept their roles confined to issuing press releases and have done nothing to protect unsuspecting users of crypto currency.
