Stringent Cryptocurrency Bill, Scheduled to be Debated Upon During Monsoon Session, Receives Further Postponement
The tempestuous and speculative future of cryptocurrencies in India shall continue to possess ambivalence, as the Lok Sabha Bulletin for the Monsoon Session of Parliament excluded the consideration and passing of the uncompromising Cryptocurrency and Regulation of Official Digital Currency Bill, 2021. The enactment would seek to make all private and foreign cryptocurrencies become non licet, although the fundamental technology utilised for the operation of cryptocurrencies would be exempted from prohibition. Speculations also existed concerning that the government would be producing its own “Digital Rupee”.
Sourcing figures from Chainalysis, all time investments by Indians in cryptocurrencies aggregated a phenomenal $6.6 billion in 2021, according to Chainalysis (nearly a 615% increase from April 2020). A complete prohibition of all non-governmental cryptos would instigate a plethora of severe ramifications, yet with the existence of several tendentious aspects, such as decentralisation and security concerns (and also greater domination), the Indian government is more inclined towards a complete interdiction.
This is certainly not the premier instance of India’s attempt to proscribe cryptocurrencies. The Reserve Bank of India, on April 6th, 2018 issued a circular intending to criminalise the utilisation of cryptocurrencies by any financial institution, however, this circular would be revoked on March 4th, 2020 by the Supreme Court after being termed as “unconstitutional”.
With the current 2021 bill, Finance Minister Smt. Nirmala Sitharaman in an interview with The Hindu earlier this year hinted at the consideration and passing of the cryptocurrency legislation - “The Cabinet note is ready. We have to see when the Cabinet can take it up and consider it so that then we can move it”. Significant speculation existed concerning how the future of cryptocurrencies would be resolved in the Monsoon Session, however, investors and businesses will be forced to remain uncertain regarding the future legality of cryptocurrencies, with the further postponement of the CRODCB.
RBI’s Reprimandation of MasterCard’s Non-Compliance
Moving onwards, following a nonconformity towards the RBI’s Storage of Payment System Data, the bank prohibited MasterCard Asia from the provisions of new cards to consumers in India on July 15th. The proscription will take effect on July 22nd, however, it will not present any consequence towards existing MasterCard holders. Several private sector banks, such as Yes Bank, Bajaj Finserv, IndusInd Bank, Axis Bank, and ICICI Bank, will be significantly impacted by the prohibition due to their heavy dependency on MasterCard for the bestowment of cards.
Connecting back to the RBI’s April 2018 circular, it was mandated that payment system data for foreign-based banks was to be ensured to solely be localised in India. Earlier in May of this year, American Express Corp as well as Diners Club International Ltd received the same interdiction due to noncompliance in data storage policies.
PayTM to Break Indian Stock Market Records
One97 Communications, the parent company of one of India’s most prospective and pervasive digital payment platforms, PayTM, on Friday filed an ambitious IPO which will possess the title of the most colossal public issuing in Indian stock market history, scheduled to generate Rs. 16,600 Crore (over $2.2 billion).
Written by: Ronojoy Borpujari