India has no plans to recognise Bitcoin as currency: Nirmala Sitharaman

Bengaluru: The central government has no plans to recognise Bitcoin as currency, Finance Minister Nirmala Sitharaman told the Lok Sabha on the first day of the winter session of the Parliament, ahead of the tabling of India’s Cryptocurrency Bill 2021.

The minister was responding to a question from Karnataka Lok Sabha members Sumalatha Ambareesh (Independent) and DK Suresh (Congress). The government doesn’t collect data on Bitcoin transactions, she said in response to a question on whether the Centre was aware of the surge in crypto trading in the country.

The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, “seeks to prohibit all private cryptocurrencies in India” but allows for “certain exceptions to promote underlying technology and its uses”, according to a Lok Sabha bulletin that was put out before the winter session of the parliament.

To another question from the Tamil Nadu member Thirumavalavan (VCK), MoS (Finance) Pankaj Chaudhary said cryptocurrencies are unregulated in India.

“RBI has vide its circular dated May 31st, 2021, advised its regulated entities to continue to carry out customer due diligence processes in line with regulations governing standards for Know Your Customer (KYC), Anti-Money Laundering, Combating of Financing of Terrorism (CFT) and obligations of regulated entities under Prevention of Money Laundering Act, 2002, in addition to ensuring compliance with relevant provisions under Foreign Exchange Management Act (FEMA) for overseas remittances.”

Chaudhary also informed the House that Enforcement Directorate’s Bengaluru zonal unit has registered a case related to Bitcoin. The government, however, would not disclose much information as it is not in the larger public interest, he told Janata Dal (Secular) member Prajwal Revanna in a written reply.

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The Karnataka Police, the union minister said, were examining a cybercrime case involving Bitcoin, and suggested that the Centre has no plans to hand the case to the Central Bureau of Investigation as police and public order are state subjects. States and Union Territories are primarily responsible for the prevention, detection, investigation and prosecution of such crimes including financial frauds through their law enforcement agencies, he said.

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