PM Modi chairs meeting on cryptocurrencies; govt to engage with experts, stakeholders

Prime Minister Narendra Modi on Saturday chaired a high-level meeting on cryptocurrencies and other related issues. Officials from the Reserve Bank of India (RBI), Finance Ministry, the Securities and Exchange Board of India (SEBI) were also part of the meeting.

The meeting was an outcome of a consultative process as RBI, Finance Ministry and Home Ministry have already done an elaborate exercise on it as well as consulted experts from across the country and the world. Global examples and best practices were also looked at, government sources said.

During the meeting, it was strongly felt that attempts to mislead the youth through over-promising and non-transparent advertising should be stopped. Besides, it was also discussed that unregulated crypto markets cannot be allowed to become avenues for money laundering and terror financing, the sources said.

The government is cognizant of the fact that this is an evolving technology and will keep a close watch and take proactive steps. There was also a consensus in the meeting that the steps taken in this field by the government should be progressive and forward looking, the sources added.

"Since the issue cuts across individual countries' borders, it was felt that it will also require global partnerships and collective strategies." the sources said, adding that the government will continue to proactively engage with experts and other stakeholders on the issue.

Also Read: Cryptocurrency regulatory framework globally and how India is self-regulating

The Parliamentary Standing Committee on Finance has invited cryptocurrency players for a meeting on Monday to discuss the opportunities and challenges of the industry.

While the RBI has time and again cautioned investors on the potential pitfalls of cryptocurrencies, the Indian government has so far been following the middle path of looking to strictly control while also promoting the use of blockchain technologies.

RBI Governor Shaktikanta Das on Wednesday reiterated his views against cryptocurrencies, saying they are a serious threat to any financial system since they are unregulated by central banks.

His comments came ahead of the RBI's internal panel report on the contentious topic which is expected next month.

The Supreme Court in early March 2020 had nullified the RBI circular banning cryptocurrencies. Following this, the central bank on February 5, 2021 instituted an internal panel to suggest a model for its digital currency.

The RBI has announced its intent to come out with an official digital currency in the face of proliferation of cryptocurrencies like Bitcoin about which it has many concerns.

Also Read: Parliamentary committee invites crypto players to discuss challenges of the industry