Crypto currencies counters in the Indian exchanges plunged sharply after the reports said the government is coming out with a bill that will ban most private tokens.
Bitcoin fell as much as 17 per cent, Ethereum was down 14 per cent, Dogecoin over 20 per cent and Polkadot 14 per cent. Even dollar-pegged token Tether was down nearly 17 per cent.
Currently, bitcoin is exchanging hands at $58,078.62 a 2.83% 24-hour gain compared to the plunge recorded earlier. Ether, the second-largest cryptocurrency was trading at $4,378.85 a 2.72% 24hour gain.
A parliamentary bulletin dated Nov. 23 showed that the Indian government plans to introduce a new bill aimed at regulating digital currencies when Parliament begins its winter session starting Monday.
Through that bill, India is seeking to ban most private cryptocurrencies as well as to establish a framework for creating an official digital currency to be issued by the Reserve Bank of India. However, it will allow “for certain exceptions to promote the underlying technology of crypto currencies and its uses,” the bulletin said.
The central bank is considering a digital Indian rupee that could reportedly launch a pilot in the second quarter of 2022.
Avinash Shekhar, co-CEO of Zebpay, said that in the last eight to nine months, the government’s stance on cryptocurrencies changed after officials consulted with various stakeholders including crypto exchange operators.
“There has been lots of positive vibes from the government. We met the finance committee of Parliament around two weeks back. The message or the feelers which we are getting from the government is that they’re looking for some kind of regulation — strict regulation, but not a complete ban.” said Avinash Shekhar, co-CEO of Zebpay.
In March, India was considering a law that would ban crypto currencies, fine anyone trading in the country or even holding such digital assets, Reuters reported, citing a senior government official.
Since then, New Delhi has changed its stance slightly and is now trying to discourage trading in crypto by imposing hefty capital gains and other taxes, according to the news agency.
Prime Minister Narendra Modi this month gave a keynote address at the Australian Strategic Policy Institute’s The Sydney Dialogue where he said all democratic nations must work together on crypto to “ensure it does not end up in wrong hands, which can spoil our youth.”