Yesterday, June 8th 2019, Indian media outlets reported the release of a draft bill to ban cryptocurrencies in the country.
The proposed bill is titled “Banning of Cryptocurrency and Regulation of Official Digital Currency Bill 2019”, and it suggests stiff penalties for anybody who is involved with cryptocurrencies such as Bitcoin.
It further goes on to detail that any person within the country who is proven to “mine, generate, hold, sell, transfer, dispose, issue or deal in cryptocurrencies” will be susceptible to a whopping 10 year jail sentence.
To add to the harsh penalty, the drafted bill also recommends that anybody caught, and charged for, holding cryptocurrencies should not be granted bail.
As with many governments around the world, the Indian government has taken the stance that cryptocurrencies are misused for money laundering and other illegal activities, thus (wrongly) justifying their ban.
India’s Central Bank Denies Any Involvement
It details the actions of Varun Sethi, founder of Blockchain Lawyer, in his attempt to get some answers regarding the bill which was originally drafted back in April 2019.
Varun attempted to utilise the Right to Information act in order to acquire details of the Central Bank’s input, stating:
“Our team was expecting to get insights about RBI role in helping draft the bill since it had been proactive in educating and informing investors about risks of cryptocurrencies,”
However, the centralised bank offered no further insight into the process of making the draft bill, simply denying all involvement.
Even more frustrating, and unbelievable, the bank goes on to deny that they even had knowledge of the drafted bill.
“RBI has actually stated that they have not received any communication from any department and they have also not given any communication to any government department pertaining to [the] drafting of this bill and this is very surprising.” states Varun.
If the bank is being truthful (highly unlikely) it would beg the question of why they have not been consulted in the creation of a bill which will directly involve them.
The Indian rupee is a closed currency, meaning it cannot be taken outside of India. As cryptocurrencies directly undermine the ability of the Indian government and central bank to control cashflow it is highly likely that the bank would, or should, have been consulted during the bill’s creation.
To add further skepticism to the integrity of RBI, when Varun asked to see minutes from an interministerial meeting which states “There is an urgent need to ban sale purchase and issuance of cryptocurrency” (reported by the Economic Times), the bank simply stated “It is not clear as to which minutes of the meeting is being quoted by the news article published in Economic Times.”.
What Does This Mean?
If the bill does become enforceable I would not be surprised to see a task force setup in order to track and punish crypto holders, while allowing the government to confiscate any crypto they uncover.
As the police forces in India can be extremely corrupt it is not far-fetched to believe that this bill could lead to a whole new world of baksheeshes (bribes).
If the bill does come to pass, it would also be wise for travellers to the Indian sub continent to hide any traces of crypto wallets from their phone or laptop.
There is no telling to what extent the government will want the law enforced and the last thing you want is to be held in an Indian jail for holding a couple satoshis.
How about the maximum sentence for sexual assault of a person? Up to 7 years imprisonment and a fine, depending on the severity. In some circumstances the offender will even be offered bail.
What about the maximum sentence for killing, maiming or mistreating animals? 5 years in prison and a fine.
To put all of this into context, the Indian government is stating that simply holding some Bitcoin, which has been legitimately acquired, is of more concern than the welfare of the Indian people and animals.
What world do these law makers live in?
Love, peace and happiness.