New Delhi: The Indian government announced on Tuesday its plan to ban all but a few private cryptocurrencies and at the same time allow an official digital currency of the RBI. A bill called the “Cryptocurrency and Regulation of Official Digital Currency Bill, 2021”, which aims to ban all private cryptocurrencies in India, will be presented during the winter session of Parliament starting November 29th. However, it allows certain exceptions to promote the underlying technology of the cryptocurrency and its use.
With the introduction of this bill, the government’s goal is to “provide a facilitating framework for the creation of the official digital currency issued by the Reserve Bank of India”. The bill was listed for introduction, examination and approval in the Lok Sabha and is one of the 26 new bills to be presented in the parliamentary session from November 29th.
Speaking of the ban on all private cryptocurrencies: There has always been a heated debate about cryptocurrencies, especially Bitcoin, which is said to be the largest digital currency by market capitalization so far. And because of such controversy over these digital currencies, a number of countries have restricted the use of bitcoin, and several countries have completely banned the use of bitcoin and cryptocurrencies, with heavy penalties imposed on anyone who makes crypto transactions.
Let’s take a look at countries that have banned and restricted the use of cryptocurrencies like Bitcoin:
- Nepal: The Nepal Rastra Bank declared Bitcoin illegal in August 2017.
- China: Since the advent of digital currencies, China has cracked down on cryptocurrencies and has been pretty brutal with its restrictions. To deal with crypto giants like Bitcoin, China has even launched its own centrally regulated digital currency called the Digital Renminbi (RMB). The government has also cracked down on bitcoin mining in the country. So it can be said that Bitcoin is fundamentally prohibited in China.
- Vietnam: The issuance, delivery and use of Bitcoin and other cryptos are illegal as a means of payment and punishable by fines ranging from VND 150 million (€ 5,600) to VND 200 million (€ 7,445), according to the State Bank of Vietnam. However, the government does not prohibit Bitcoin trading or holding Bitcoins as an asset.
- Colombia: In this country, financial institutions are not allowed to enable Bitcoin transactions. In early 2014, the Superintendencia Financiera warned financial institutions not to protect, invest, broker or manage virtual money transactions.
- Russia: Bitcoin is not regulated at all in Russia and its use as a means of payment for goods or services is also illegal.
- Ecuador: Bitcoin and other cryptocurrencies were banned in Ecuador by a majority vote in the National Assembly.
- Bolivia: The government of this country has completely banned all currencies that are not subject to the regulatory radar of the Bolivian economic system since 2014. The Bolivian government made the decision citing the possibilities of various pyramid schemes and criminal activities.
- Algeria: This country is currently banning the use of cryptocurrency following the passage of a finance law in 2018 that made buying, selling, using, or holding virtual currency illegal.
- Egypt: In 2018, Egypt’s Dar al-Ifta, the country’s main Islamic advisory body, issued a religious decree classifying Bitcoin transactions as “haram,” which is forbidden under Islamic law. Therefore, the country adheres to the recommendation and regards every cryptocurrency transaction as “haram”.
- Indonesia: On January 1st, 2018, Bank Indonesia, the country’s central bank, issued new regulations banning the use of cryptocurrencies, including Bitcoin, as a means of payment.