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BACK FROM THE CRYPT

India’s finance minister reconsiders a ban on cryptocurrencies

A pile of several gold Bitcoins are photographed up close.
REUTERS/Dado Ruvic/Illustration/File Photo
Lots to decipher for the world of crypto in India.
  • Karen Ho
By Karen Ho

Global finance and economics reporter

The Indian government might not completely ban cryptocurrencies. In an interview on March 5, country’s finance minister Nirmala Sitharaman said that she wants to foster innovation in crypto.

“We want to make sure that there is a window available for all kinds of experiments which will have to take place in the crypto world,” she said during an interview on CNBC TV18, a business and financial news television channel in India. “We are not closing our minds.”

The comments from Sitharaman counter a proposed bill from the Indian government in January of this year that would ban all private cryptocurrencies. The proposed law would also include a system for the creation and regulation of an official cryptocurrency issued by the country’s central bank and the promotion of blockchain, the technology underlying digital currencies. The Reserve Bank of India’s “digital rupee” is aimed at being similar to China’s “digital yuan“.

Local business and lobbying groups like the Association for Blockchain, Crypto and Digital Asset Entrepreneurs and the Blockchain and Crypto Committee formed in response to the news of the potential ban in an effort to lobby the government and enhance its understanding of cryptocurrencies.

In mid-February, Balaji Srinivasan, the former chief technology officer of the crypto trading platform Coinbase, compared the proposed law to “banning the internet”. ”It would be a trillion-dollar mistake for India, without exaggeration,” he said during an interview with The CapTable, an online business-news publication in India.

While Sitharaman said the country’s central bank would take the lead on overseeing “unofficial cryptos”, her comments indicated a possible outcome of regulating cryptocurrencies instead of an outright ban. “There will be a very calibrated position taken,” she said.

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