The lower house of the Parliament expects banks to conduct transactions using cryptocurrencies as funds without problems or prohibitions
Pon Radhakrishnan, Minister of State in the Ministry of Finance and the Ministry of Maritime Transport of India, formally informed, last December, that the Government is evaluating the creation of a series of regulations to monitor transactions with cryptocurrencies in India, but the official believes that this will not happen in the short term. That is a surprise for citizens.
The issue has been debated for some time. However, the Hindu government imposed a prohibition on the national bank about making financial transactions with cryptocurrencies. This considerably affected the industry of that country in terms of international sales that could be made with stable cryptocurrencies, as well as small businesses that seek to diversify their payment methods with international standards.
A counterclaim for these prohibition measures was taken to the Indian National Parliament and discussed forcefully. Lok Sabha (the lower chamber or the first chamber of the Parliament), spoke on the subject: “In the absence of a globally acceptable solution and the need to design a technically viable solution, the department is carrying out the matter with due caution. It is difficult to establish a specific timeline to reach clear recommendations”.
However, the government spokesmen said that: “Important efforts are being made to prepare the draft report and the bill on virtual currencies, and also about the use of distributed accounting technology in the financial system and the framework for digital currency in India”.
Cryptocurrencies are not completely illegal in India; there are no terms that define their impact on the economy. It is hoped that with these fiscal control measures, the use of this financial resource in the country will be normalized and that with the lifting of the prohibition for the banking operation with cryptoactives, the financial flow between Indian banks and international banks will be diversified.
A legal Framework for Cryptoactives
Other governments have introduced laws and promoted the use of cryptoactives. It is the case for the Government of the Bolivarian Republic of Venezuela, which began by announcing, during 2018, the creation of the “Petro”, a virtual currency that has as liquidity reserves oil, gold, gas and diamond, approved by the Central Bank of Venezuela (BCV).
Similarly, the President of Venezuela, Nicolás Maduro, reported on the creation of entities attached to ministries dedicated to the development of Blockchain technology and Licensing Acquisition Manuals for currency exchange offices in that South American country. Furthermore, it even invites its citizens to have savings in Petros.
Other countries such as China have taken measures similar to those of India since, at the end of 2013, the Chinese People’s Bank banned financial institutions from carrying out transactions with cryptoactives; however, it does allow people to have cryptocurrencies.
Whilst governments like Spain are promoting to the European Union (EU) to regulate the use of cryptocurrencies and give them a status of legality throughout Europe. In fact, Europe gives a great example of this, because there are entire streets of businesses that sell products and services through Bitcoins in Spain.
By María Rodríguez