A blanket ban on cryptocurrencies will encourage non-state players, leading to more unlawful usage of such currencies, the Blockchain and Crypto Assets Council (BACC), a part of the non-profit Internet and Mobile Association of India (IAMAI), said on Thursday.
The statement from BACC, representing major crypto exchanges based in the country, came after the government sought to ban all private cryptocurrencies in the upcoming Crypto Bill 2021.
Prime Minister Narendra Modi had earlier said that all democratic countries need to work together on cryptocurrency and ensure that it does not end up in the wrong hands which can spoil our youth.
The IAMAI said that it “fully concurs with this view and in its submission before the Supreme Court earlier listed several negative outcomes of a ban such as zero accountability and traceability of the origin and end usage of the cryptocurrencies, besides a complete evasion of taxes.”
“A ban will also adversely impact retail investors. The Council has always argued in favour of prohibiting the usage of private cryptocurrencies as a currency in India by law since usage as currency is likely to interfere with monetary policy and fiscal controls,” said the council.
The BACC said it believes that a smartly regulated crypto assets business will protect investors, help monitor Indian buyers and sellers, lead to better taxation of the industry, and limit illegal usage of cryptos.
Several high-profile meetings have been held to discuss the regulation of cryptocurrencies in recent days. The Parliamentary Standing Committee had also called for the regulation on cryptocurrencies and its ecosystem.
The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, seeking to prohibit all private cryptocurrencies in India, is set to be tabled in the Winter Session of Parliament, starting November 29.