Lok Sabha Question No. 2975 (UNSTARRED), answered on 2018-12-28
Subject: Crypto Currencies
Ministry: FINANCE
Asked by: FEROZE VARUN GANDHI, BHARATENDRA SINGH, ARVIND GANPAT SAWANT

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOKSABHA UNSTARRED QUESTION NO. 2975 TO   BE ANSWERED ON 28 th  December 2018/Pausha 7, 1940(SAKA)

## Crypto Currencies

## 2975. SHRI FEROZE VARUN GANDHI: KUNWAR BHARATENDRA: SHRI ARVIND SAWANT:

## QUESTION

Will the Minister of FINANCE be pleased to state:

- a) the stance of the Government on the legality of trading in crypto currencies;
- b) the  details  of  the  composition  of  the  panel  established  to  draft  regulations  to  govern  crypto  currencies  and  the recommendations made by the panel and the timeline for the expected release of the regulations;
- c) whether the Government has conducted any awareness campaigns to warn the general public of the speculative risks of such crypto currencies and taken measures against its misuse for money laundering and terrorist funding, if so, the details thereof and if not, the reasons therefor;
- d) whether the  Government has  been  keeping  a  track  of  the  value  of  crypto  currencies  traded  by  Indian  Nationals within the Indian territory, if so, the details thereof; and
- e) whether  the  Government  is  considering  to  introduce  its  own  form  of  crypto  currency  in  place  of  Bitcoins  and proposes  to  bring  any  license  and  authorization  to  any  entity  or  company  to  operate  such  schemes  or  deal  with Bitcoins or any virtual currency and if so, the details thereof?

## ANSWER MINISTER OF STATE IN MINISTRY OF FINANCE (SHRI Pon. RADHAKRISHNAN)

- a) The  Government has not recognised  crypto  currencies as legal tender.  The issue  of  permitting  trading  in  crypto currencies is currently under examination by an Inter-Ministerial Committee.
- b) The  Government  has  constituted    an  Inter-Ministerial  Committee  (IMC)  under  the  Chairmanship  of  Secretary, Department  of  Economic  Affairs  with  representatives  from  concerned  Departments  to  study  all  aspects  of cryptocurrencies and crypto-assets including Bitcoin. The Committee, with representation from MeitY, RBI, SEBI and CBDT is working to develop a framework for regulating cryptocurrencies. However, in absence of a globally acceptable solution and the need to devise technically feasible solution, the Department is pursuing the matter with due caution. It is difficult to state a specific timeline to come up with clear recommendations.
- c) The Government and the RBI has been warning the users of crypto-currencies of the dangers posed by such virtual currencies. Government vide press release dated 29/12/2017 clarified that Virtual Currencies/Crypto Currencies are not  legal  tender and  cautioned  the members  of  public against the  Risks involved  in  investing  Crypto  Currencies. RBI vide press releases dated 24 th Dec, 2013, 01 st Feb, 2017 and 05 th Dec, 2017 cautioned  the public about     risks and  dangers  with  Virtual  currencies  including  potential  financial,  operational,  legal,  customer  protection  and security related risks that they are exposing themselves to by investing in Bitcoin and/or other Virtual currencies. RBI has also clarified that it has not given any license/authorization to any entity/company to operate such schemes or  deal  with  Bitcoins  or  any  virtual  currency.    Further,  RBI  in  its  letter  dated  6.4.2018  has  advised  all  entities regulated by it not to  deal in VCs or provide services for facilitating any person or entity in dealing with or settling VCs. Accordingly, this ban came into force w.e.f. 6 th July, 2018.
- d) No, Sir.
- e) The Inter-Ministerial Committee (IMC) under the Chairmanship of Secretary, Department of Economic Affairs is examining all issues, including the pros and cons of the introduction of an official digital currency in India. No

decision on licensing and authorising any entity or company to operate such schemes or deal with Bitcoins or any virtual currency has been made as yet.

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