Bitcoin (BTC) in India Could Result in 10-Year Jail Term if Proposed Bill Approved
A bill has been proposed in India to severely restrict any crypto activity, including owning and mining Bitcoin (BTC).
India may come up with even harsher cryptocurrency regulations, as a new bill was proposed to make any activity related to Bitcoin (BTC) punishable by a jail sentence. The bill proposes a 10-year term for offenders who “mine, generate, hold, sell, transfer or even possess BTC or other cryptocurrencies, reported the Economic Times India.
The country, which has a strong grass-roots crypto community, moved from a lax to restrictive stance on digital assets in just a year.
India has been restrictive to exchanges, making its largest operator, CoinDelta, close after being denied banking services. Additionally, India has made attempts to de-monetize the country’s grey economy by mopping up excess cash held with the population. The country has attempted to encourage transparent electronic transfers, and cryptocurrencies are a way to preserve the pace of a grey economy.
The bill against Bitcoin has been proposed by Economic Affairs Secretary Subhash Chandra Garg. Digital coins are seen as a way to avoid taxation, as well as move funds outside the control of governments. Money laundering and terrorism financing concerns have led to additional restrictions on the usage of digital assets.
If the bill passes, India will join the list of countries completely banning BTC, including Algeria, Egypt, Morocco, Bolivia, Colombia, Ecuador, Saudi Arabia, Iran, Nepal, Pakistan, and others. In the past months, implicit or explicit bans have grown the list of countries with a hard stance on the usage of digital assets. China, for instance, has an implicit ban on attempting to circumvent official payment channels and export capital.
While the Bitcoin network itself could bypass censorship, it is still possible to track users. Even in Iran, where using BTC is banned, there are five active nodes, and India hosts 28 nodes, showing a grassroots involvement with cryptocurrencies.
India’s move underlines the fact that BTC usage is attempted when failing regimes bring about instability and hyperinflation. In the past months, India has also seen an uptick in the usage of LocalBitcoins. But recently, even this service disabled cash-based peer-to-peer trades, resorting to electronic transactions.
At the same time, the Reserve Bank of India has shown interest in blockchain-based coins, working on its own Digital Ruppee. So far, no significant progress has been reported on this.