India has been dead silent about cryptocurrencies ever since they placed a virtual ban on it back in April 2018. It has been really hard for the locals to buy and sell cryptocurrencies ever since the Reserve Bank of India (RBI) decided to close down bank accounts that were seen making any crypto-related transactions.
Soon after, a Draft bill that was designed to regulate cryptocurrencies and put a ban on them, surfaced the internet. The existence of the bill dubbed “Banning of Cryptocurrency & Regulation of official digital Currencies” was soon confirmed by the Ministry of Finance. This sent the entire Indian crypto community into a state of panic as people who had a lot of money invested in digital assets would lose it all.
The bill was supposed to be introduced during the winter session of the Lok Sabha which is the lower house of the Indian parliament but ended up not being included in the published agenda for the winter session. Alongside this, the Indian Supreme Court had also postponed all writ petitions regarding cryptocurrencies and digital assets to January 2020.
Without any clear regulations at play, the Indian crypto industry is struggling to determine the future of cryptocurrencies in India. The crypto ban bill did talk about a Digital Rupee that would be issued by the country’s central bank, but there were no reports of it being developed thereafter.
However, a recent Economic Times article has revealed that the authorities are looking to work on a strategy to deploy blockchain technology at a national level. The move sounds quite similar to that of China as it has played by the same rule where they utilize blockchain technology while curbing the use of cryptocurrencies.
The report states that the ministry of electronics and information technology (MeitY) has said that it recognizes the potential of blockchain technology and need “the need for shared infrastructure for different use cases.” This a first major move from the Indian government that looks to implement blockchain technology in various sectors of the Indian economy. Adding to this the ministry further mentioned that they are devising an approach paper about a National Level Blockchain Framework.
Talking about the different use cases of blockchain technology in various sectors, Minister of State for electronics and IT Sanjay Dhotre said:
“Blockchain Technology as one of the important research areas having application potential in different domains such as Governance, Banking and Finance, Cyber Security and so on.”
Prior to this, MeitY has been involved in supporting a research conducted on the use of Blockchain and developed Proof-of-Concept solutions by the Centre for Development of Advanced Computing (C-DAC), The Institute for Development & Research in Banking Technology (IDRBT) and others as executing agencies.
The property registration based on blockchain is already being piloted and other solutions that include Cloud Security Assurance, C-KYC and trade finance are also being developed. According to Dhotre, a proof of existence (POE) consensus is being developed to be used to authenticate digital artefacts, academic certificates, sales deeds, MoU etc. He added:
“By using PoE framework, solution is developed to authenticate academic certificates. Blockchain Technology has also been used and PoC is developed for vehicle life cycle management and hotel registry management PoC.”
Looks like India is following China’s footsteps in approaching this emerging new technology. If this is the case, then the regulators might also be looking to completely ban private cryptocurrencies and focus all their efforts on the development of blockchain technology. A national cryptocurrency might also come into existence.