No proposal to recognise bitcoin as currency, finance ministry says in Lok Sabha

The government is expected to bring a bill to regulate cryptocurrency in the winter session of Parliament, which began today. Cryptocurrencies like bitcoin work on blockchain technology - a decentralised ledger of transactions.
Bitcoin is a type of cryptocurrency, which works on the blockchain technology.(Representative Photo/Reuters)
Bitcoin is a type of cryptocurrency, which works on the blockchain technology.(Representative Photo/Reuters)
Published on Nov 29, 2021 01:26 PM IST
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By | Written by Amit Chaturvedi, Hindustan Times, New Delhi

The Union finance minister said in Parliament on Monday that central government does not collect any data on bitcoin transactions. It also said that there is no proposal to recognise bitcoin as a currency in the country.

The response was given the form of a written reply in the Lok Sabha on a question on cryptocurrency. A legislation seeking regulation of cryptocurrency will be discussed in the winter session of Parliament, which began on Monday.

The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, seeks to create a framework to regulate digital to be currency issued by the Reserve Bank of India (RBI).

According to the Lok Sabha website, the bill will also seek to prohibit all private cryptocurrencies in India, barring certain exceptions to promote the underlying technology of cryptocurrency and its use.

Currently, there is no regulation or ban in the country on cryptocurrency.

Prime Minister Narendra Modi had held a meeting earlier this month where he discussed the issue with senior officials. The Standing Committee on Finance, chaired by Bharatiya Janata Party (BJP) leader member Jayant Sinha, met the representatives of crypto exchanges, blockchain and Crypto Assets Council (BACC), among others this month and arrived at a conclusion that cryptocurrencies should not be banned, but regulated.

The Reserve Bank of India has repeatedly reiterated its strong views against cryptocurrencies, saying they pose serious threats to the macroeconomic and financial stability of the country and also doubted the number of investors trading on them and their claimed market value.

The RBI had announced its intent to come out with an official digital currency in the face of the proliferation of cryptocurrencies like bitcoin.

Cryptocurrencies work on blockchain technology - a decentralised ledger of transactions. This isn’t maintained or stored in one place or with any central authority. Instead, it is spread across a network of computers, also known as peer-to-peer networks.

This system is used to authenticate transactions done using crypto coins.

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Tuesday, January 18, 2022