Government in India can resolve cryptographic tokens, but not cryptocurrency

Government in India can resolve cryptographic tokens, but not cryptocurrency

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The Indian government is considering the possibility of legalizing certain cryptographic assets, despite the negative attitude to cryptocurrencies in general, writes the local news publication DNA India.

The Ministry of Finance formed a council chaired by the Secretary of the Department of Economic Affairs (DEA), which should develop a set of regulatory measures and a roadmap to allow the use of certain cryptographic assets in India. A corresponding bill will be submitted to the parliament as soon as it is ready, the source said.

DEA Secretary Subhash Chandra Garg said:

“The Board is exploring the possibility of using cryptocurrency or cryptographic technologies and the technology of a distributed registry for financial transactions, as well as regulatory measures necessary for their use. While the currency function remains completely banned, the council considers other opportunities for their application and popularization in India.”

Garg called the technology of the distributed registry “extremely promising,” but “categorically rejected” the use of cryptocurrency “in any form,” including payment systems.

He also said that the DEA appointed “several advisers” who should inform the public about the risks of cryptocurrency, from his words, which are “pyramid-like schemes” and “not currencies” at all.

Garg, however, believes that the government needs to study the issue of tokenization of real-world assets and the opportunity to replace the country’s currency with a cryptographic token.

“The token will be bought for cash and stored as code in any, even the most simple mobile phone. It can also be used for calculations. It is easy to implement from a technological and regulatory perspective. But in the case of cryptocurrencies, they must first be recognized as a legal tender,” he said.

Meanwhile, the Supreme Court of India postponed the decision on the ban of the Reserve Bank of the country on the cryptocurrency activity of regulated financial institutions until September this year.

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