The government is thinking to launch crypto tokens for financial transactions in India. The sources say that the ban on trading cryptos will continue but the government has developed a soft corner for these cryptocurrencies. The government is also considering to replace smart cards with such tokens, as reported by DNA
The government is making plans to use these tokens in two sectors. Private and Public.
In the private sector, it will be used as loyalty points for example as air miles which can help you to buy the next air ticket in a lesser amount.
In the public sector, these tokens will be initially issued as metro cards.
In future, the government may also allow the usage of cryptocurrencies for trading and making transactions.
There are media reports that show that a committee is made by the government and it is working on the formulation of rules and regulations and also the specific actions that are required regarding this law. Once they are legally vetted, the drafted rules and regulations will be put forward the Parliament.
The government clarifies that people will be needing the fiat currency to buy these tokens that will eliminate the threat to the country’s monetary policy. The justification is however still not clear.
Earlier this year, in April there was a statement by RBI in which the Reserved Bank directed all regulated entities including banks, e-wallets, and payment gateways to get rid of all the deals with people or organizations that are related to decentralized currency.
They have compared this to Ponzi scheme which includes fraud. The Finance Ministry believes that these currencies i.e. the cryptocurrencies cannot be trusted as they are backed up by any assets.
According to them the price of the cryptocurrencies are only speculations and they are not worthy of investing money due to the high risk.
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