indica News Bureau
The National Association of Software and Services Companies (NASSCOM) said in a statement earlier this week that it believes the proposal by India’s Inter-Ministerial Committee of the Government to ban all cryptocurrencies except digital Rupee backed by the government is counterproductive and the industry group is calling for the government to work on developing a risk-based framework to regulate and monitor cryptocurrencies and tokens.
The group said in the statement that a ban would inhibit new applications and solutions from being deployed and would discourage startups and would handicap India from participating in new use cases that cryptocurrencies and tokens offer.
According to published reports on a leaked version of an Indian government panel’s draft of Banning of Cryptocurrency and Regulation of Official Digital Currency Bill, 2019, the measure would make it illegal to deal in cryptocurrency, including Bitcoin, Ethereum, Ripple and others, in India. They are not regulated by the Indian government.
NASSCOM said it will continue to seek more discussion on this issue.
“To address consumer protection concerns, cryptocurrency-based businesses can be tested in the regulatory sandboxes being launched by the financial sector regulators across the country,” the NASSCOM statement read. “We should work towards creating a regulatory framework that will constantly monitor and prevent illegal activities. Regulating would allow the law enforcement agencies to be better equipped to understand these new technologies, enable them to gather intelligence on criminal developments and take enforcement actions. Conversely, a ban is more likely to deter only the legitimate operators as they have no intent to be non-compliant.”
The group also said it welcomes the panel’s recognition of the potential of Distributed Ledger Technology (DLT).