Conflicting views halt crypto Bill’s progress

New Delhi, December 15

Parliament is unlikely to take up two critical Bills — one on regulating cryptos and the other on privatisation of public sector banks — in the ongoing Winter Session. Both the Bills, which were among the list of 26 new pieces of legislation set for introduction in the ongoing Session, are likely to be pushed to the Budget Session.

According to the Lok Sabha Bulletin, the purport of the ‘Cryptocurrency and Regulation of Official Digital Currency Bill, 2021’ Bill was “to create a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India. It also seeks to prohibit all private cryptocurrencies in India; however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses.”

Minister of State in the Finance Ministry Pankaj Chaudhary subsequently told Parliament that the Bill is “under finalisation for consideration of the Cabinet”. But the Bill was not on the agenda of the Cabinet meeting on Wednesday. The ongoing session will end next week (on December 23).

Multiple views

Government officials’ opinion on the subject is quite divergent: while many advocate complete ban, some do not want a ban and want cryptocurrency to be allowed as an asset class; some also want SEBI to regulate it.

Currency and banking products are regulated by the RBI, while investment assets such as equity or commodity are regulated by SEBI.

The RBI has repeatedly raised its objection on cryptocurrencies. Governor Shaktikanta Das is on record saying: “We have major concerns around cryptocurrencies, which we have conveyed to the government.” Sources acknowledged that concerns communicated to the government “were too stringent and centred around a ban just like in China’s case. Then there are examples of moderate regulations like those being followed in European countries. Now, effort is on to find a middle path.”

Banking Bill

Finance Minister Nirmala Sitharaman proposed privatisation of two public sector banks in the Budget. Accordingly, The Banking Laws (amendment) Bill 2021 was listed for the Winter Session to facilitate privatisation. However, bank unions are strongly opposing this move and have threatened to go on strike. Political considerations are said to be behind the deferment of this Bill as well.

Source: https://theoutreach.in/crypto-banking-bills-may-be-deferred-to-budget-session/