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Government Seeks To Block Cryptocurrencies In New Bill, Prices Crash: 10 Points

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Currently, El Salvador is the only country to recognize cryptocurrency as legal tender.

The Center will likely introduce a bill in the winter session of Parliament to ban all cryptocurrencies in India, with a few exceptions, and create a framework to regulate the digital currency issued by the Reserve Bank of India (RBI ). In response, all major digital currencies saw a decline of around 15% and more, with Bitcoin down around 18.53 percent, Ethereum down 15.58 percent, and Tether down 18.29 percent.

Here is your 10 point cheat sheet for this great story:

  1. The Cryptocurrency and Official Digital Currency Regulation Bill 2021 is listed to be introduced in the Lok Sabha during the winter session, which is due to start from November 29.

  2. The bill seeks to “create a framework to facilitate the creation of the official digital currency to be issued by the RBI.” It also seeks to ban all private cryptocurrencies in India, however, it allows certain exceptions to promote the underlying technology of the cryptocurrency and its uses.

  3. The Reserve Bank has expressed “serious concerns” about private cryptocurrencies. Bitcoin, the world’s largest cryptocurrency, hovers around $ 60,000, and its price has more than doubled since the start of this year, attracting hordes of local investors.

  4. Industry estimates suggest that there are 15-20 million crypto investors in India, with a total of around Rs 40,000 crore ($ 5.39 billion) in cryptocurrency.

  5. Recently, there have been a growing number of advertisements promising easy and high returns on investment in cryptocurrencies, amid concerns about these currencies being used to lure investors with misleading claims.

  6. Last week, the Standing Committee on Finance, chaired by BJP member Jayant Sinha, met with representatives from crypto exchanges, blockchain, and the Crypto Assets Council (BACC), among others, and came to the conclusion that cryptocurrencies shouldn’t be banned, but they should be regulated.

  7. Private digital currencies have grown in popularity over the past decade. However, regulators and governments have been skeptical of these currencies and fear the associated risks.

  8. On March 4, 2021, the Court of Cassation annulled a circular from the RBI of April 6, 2018, prohibiting banks and entities regulated by it from providing services related to virtual currencies.

  9. In a keynote address at the Sydney Dialogue on November 18, Prime Minister Narendra Modi urged all countries to ensure that cryptocurrency does not “end up in the wrong hands.”

  10. Currently, El Salvador is the only country to recognize cryptocurrency as legal tender.

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