Law Commission of India: Cryptos Are at Par with Electronic Means of Payment
Cryptocurrency issue has been trending in India especially after the release of 2018 Budget which indirectly indicated that cryptocurrency is not a valid legal tender and is illegal in India. Various crypto exchanges, since April, have been disappointed with the Reserve Bank of India (RBI) and have approached India’s top court and are awaiting clarity on the crypto issue.
Law Commission of India has recognized cryptocurrency as a valid form of electronic payment similar to debit cards and credit cards. On July 3rd, The hearing of Internet and Mobile Association of India (IAMAI), IAMAI and RBI, was held by the Supreme Court of India (SC).
Supreme Court, on the other hand, had not granted a temporary stay on the ban. The matter is postponed to 11th
September now, which was earlier scheduled for 20th July.
In a letter addressed to Union Minister Ravi Shankar Prasad in the year 2017, the Supreme Court had asked the Law Commission to consider the possibility of legalizing betting and gambling to avoid financial crimes. The report of the Law Commission indicated that government treats ‘cryptocurrency’ as other recognized electronic means of payment like net banking, debit card, and credit card.
The Law Commission had stated in its report,
“Gambling transactions should be made cashless, making use of electronic means of payment such as credit cards, debit cards, net-banking, Virtual Currencies (VC –also known as Cryptocurrency), etc.”
It further added,
“The issue of Online Gambling has further been worsened by the rise in popularity and ease of availability of VC, a form of electronic money. Having taken the form of a parallel economy, gambling with VC pushes even the Online Gambling market underground, and very often, out of the reach of the law enforcement authorities.”
Law Commission is an official body which is established by the Government of India. It works with an aim to guide the government of India on the implementation of laws. The enrollment of the Commission contains the expertise of legitimate law specialists.
In India, there are almost three million virtual currency users hence the crypto issue needs strong attention. The RBI has appealed for a ban on cryptocurrency related forms of money.
Earlier there were many debates on the RBI ban. The Reserve Bank specifically mentioned that there was no consultation and no research undertaken before the implementation of the notice and restriction in April. It also admitted that there was no committee formed to analyze the concept of the blockchain, working of virtual currencies and trading in such currencies. The answers were revealed in the RTI as RBI’s reply which indicated that the ban was arbitrary.
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