Indian Finance Panel Backs Launching Govt-backed Crypto

Oct 11, 2018 at 23:36

A Department of Economic Affairs-led panel in India is looking at recommending higher authorities to introduce a government-backed cryptocurrency into the local market.

“We are evaluating the government-backed cryptocurrency and crypto-token,” a senior government official was quoted in a Quartz report.

“And we are looking to develop and encourage our own research and development of blockchain technology,” added the unnamed source who was familiar with the discussions of the panel assigned to evaluate the task.

The source knows full well that such move “goes against the whole grain of such coins.”

“These are essentially decentralised ledgers, and if the government or the RBI is trying to control it, then it loses its meaning,” the source added.

The senior official hinted that government’s next priority in its crypto crackdown is banning the possession of digital tokens altogether once a government-backed cryptocurrency is produced.

“The panel is also discussing amendment of the Currency Act to make possession of any cryptocurrency, not approved by the government, a punishable offence,” said the government official

Established in December 2017 with the task of drawing up measures to regulate cryptocurrencies, the finance committee was supposed to finalize its report last July, a deadline toward the end of the year.

The plan echoes that of India’s central bank who is mulling to launch a stat-sponsored digital token, as reported by Disruptblock.

Perceiving digital tokens as a tool for money laundering, the central bank had been prohibiting banks from engaging with virtual currency exchanges and traders since July.