There is no plan to recognise bitcoin as a currency in India, according to the Finance Minister Nirmala Sitharaman

The Cryptocurrency and Regulation of Official Digital Currency Bill 2021 aims to outlaw all but a few private cryptocurrencies in order to encourage underlying technology while allowing the Reserve Bank of India to issue an official digital currency.

Finance Minister Nirmala Sitharaman said Monday in response to a question in the Lok Sabha that the government has no plans to recognise Bitcoin as a currency in the nation. She also told the Lok Sabha that the government doesn’t track Bitcoin transactions.

“No, sir,” the Finance Minister said when asked if the government had considered recognising Bitcoin as a currency in the country.

This comes as the government prepares to present the Cryptocurrency and Regulation of Official Digital Currency Bill 2021 in Parliament’s current Winter Session. The bill aims to outlaw all but a few private cryptocurrencies in order to foster underlying technology while allowing the RBI to create an official digital currency.

Thirumaavalavan Thol, a member of Parliament, asked the Ministry of Finance if the government is aware of the cryptocurrencies that are traded in India and if cryptocurrency trading is legal in India. He also inquired as to whether the Indian government had recognised bitcoin exchanges as a legal business.

“Government does not gather information on cryptocurrency trade,” said Pankaj Chaudhary, Minister of State (MoS) in the Ministry of Finance. In India, cryptocurrencies are unregulated. RBI has advised its regulated entities to continue to carry out customer due diligence processes in accordance with regulations governing standards for Know Your Customer (KYC), Anti-Money Laundering (AML), Combating Financing of Terrorism (CFT), and regulated entities’ obligations under the Prevention of Money Laundering Act (PMLA), 2002, in addition to ensuring compliance with relevant provisions under the Foreign Exchange Management Act (FEMA).

It’s worth noting that Bitcoin was created by an anonymous group of programmers in 2008. Users can spend money anonymously because the digital currency is not linked to a bank or government. The currencies are “mined” by users who contribute processing power to verify the transactions of other users. They are compensated with Bitcoins.

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