Earlier this year, an Economic Times (ET) report caused a huge furore in the Indian cryptocurrency community after it revealed details about a new bill which ostensibly stated that India is going to ban cryptocurrencies. A draft bill purportedly called the Banning of Cryptocurrencies and Regulation of Official Digital Currencies Bill 2019 was circulated to various government departments, cited the report.
However, an RTI application filed by ‘Blockchain Laywer’ Varun Sethi has revealed that India’s Central Bank – the Reserve Bank of India (RBI) which has become the de-facto cryptocurrency regulator in the country – has no idea about the bill. Varun asked very specific questions around the ET report and the draft bill which reportedly recommends a cryptocurrency ban in India.
According to the RTI response by RBI obtained by Varun:
- There has been no written correspondence from other government departments regarding the bill neither RBI sent out any communication in the matter.
- RBI has not received any communication from the Central Government on the matter.
- RBI did not receive any copy of the draft bill.
- RBI did not endorse to other departments a complete ban on sale, purchase and issuance of cryptocurrencies.
- RBI does not have any idea about the inter-ministerial meeting mentioned in the report.
In addition, some of the queries in the RTI application filed by Varun have been forwarded to the Central Public Information Officer (CPIO) at the Department of Economic Affairs (DEA) under the Ministry of Finance.
What does this mean?
Assuming the report to be true, the findings clearly indicate that RBI was kept out of the loop of such meetings between the inter-ministerial committees. It seems difficult to fathom that RBI, which has taken the lead on cryptocurrency regulations by introducing a banking ban, was kept out of the meetings around an important policy matter.
Interestingly, CoinCrunch India had filed an RTI regarding the bill with the DEA. However, the department rejected the RTI application on grounds that the information will be made public soon.
At an ASSOCHAM event last week, finance secretary Subhash Chandra Garg, who is also heading the official cryptocurrency committee, stated that the draft report on cryptocurrencies will be submitted to the new Finance Minister Nirmala Sitharaman soon. With RBI having no clue about the bill and the official committee yet to submit its report to the government, questions will naturally start to emerge around the very existence of such a bill.
It will be in the best interest of the public if the government makes its stand on cryptocurrency regulation known to the public. In its absence, various reports are only contributing to the rumour mills around a decision which is likely to have a huge impact on India’s technological future.