India’s former finance secretary said that cryptocurrencies can be regulated as commodities but not as currencies.
The speakers in the panel suggested that crypto is very young and the government should let it grow before concluding with any judgment.
The Indian crypto space is content with the initialization of a dialogue on cryptocurrencies in the country amidst the misty environment.
Unfortunately, Mr.Garg's views are immaterial at the present situation as he stepped down from the Inter-ministerial committee in October 2019
Crypto As Commodity and Not Currency – Mr. Subhash Chandra Garg
Mr.Subhash Chandra Garg, Ex-Chairman of ‘Inter-Ministerial Committee’, which recommended banning cryptocurrencies in India said that the crypto assets can be considered as ‘commodity’. In his recent panel with speakers including WazirX’s founder, Nischal Shetty, said that the cryptocurrencies should be outlawed completely
He now thinks that the crypto assets as commodities should be regulated effectively and DLT (Decentralized Ledger Technology) or Blockchain should be encouraged too.
While international companies and players have set their sights on India and the forthcoming crypto regulations, India is yet to make its way certain towards crypto regulations within the country. As far as Mr.Garg, he stepped down from the Inter-ministerial committee in October 2019 but under his leadership, the committee had suggested that crypto should be banned within the country. In addition to this, it also proposed a 10 years jail term and hefty fees for those who violate this law.
That being said, Mr.Garg’s present view may not necessarily matter or count for the current government. On the contrary, the crypto community is quite surprised that the man under whose leadership the crypto ban report came out is now suggesting to consider crypto assets as a commodity. However, as per Mohammed Danish, co-founder at CryptoKanoon, India’s regulatory news channel, “His views are immaterial now & have no bearing on the Govt. decision anymore”
A webinar that initiated Crypto talks
The online webinar was organized on July 17 by CREBACO, Khaitan & Co, and BlockOn Capita. Besides speakers from the above-mentioned companies, the online webinar featured Nischal Shetty from WazirX and Mr.Garg.
Mr.Garg began by discussing the origin of currency – the gold, metal, and paper currency. He explained how paper currency transitioned to digital form of money and the regulations have come forth accordingly. He then moved to talk about bitcoin and crypto-assets at large.
It is valuable in its rights, said Mr.Garg. He mentioned that paper currency has no intrinsic value. The Reserve Bank of India sets the value to the currency. Besides, he further outlines that the central bank also determines the vast sum of money be printed and circulated.
Allow the Crypto to Thrive Before Coming in Action
Everyone in the panel accepts the fact that cryptocurrencies are still very young in India compared to other nations. Hence the government should allow the technology to flourish and expand its base.
Mr. Siddhart Sogani, founder of CREBACO explained the need for a supportive environment so that the cryptocurrencies establish in the country. He said,
“There was no pilot license before the invention of the airplane. The necessary steps were taken after understanding this e technology”
“Hence the cryptos should also be allowed to grow and the government should not intervene in this initial phase. Rather support with clear guidance” he added.
On the other hand, Mr.Sanjay Khan Nagra, partner Khaitan & Co discussed the hardships faced to regulate the new technology. He also believed that if cryptocurrencies are banned then people will find a way out. Hence it’s the time to regulate keeping track of the in and out of the crypto activities. It implies to track the income utilized to buy cryptos and out implies where the cryptos have traveled.
The Indian crypto community which had a very uncertain perspective upon the future of the cryptos in India are content with the start of open discussions on cryptos. The need of having these types of discussion was well addressed and the panel well presented their thoughts. However, now the ball has landed in the government’s court as the much-awaited discussion on the cryptocurrencies in the parliament is scheduled in the coming session.