Monday saw the first meeting of the Indian Parliament to determine the future direction for cryptocurrency. Meeting ended with a unanimous agreement that cryptocurrencies should be managed in India, and that no blanket ban is possible.

Financial Express reported that one source claimed:

Members of Parliament agreed that regulation was better than banning them. There are now two possible ways to look at this. You can either ban 90% or allow 10%, or vice versa. That’s the trade-off discussion which has been pending. For that reason, it is necessary to examine each point individually.

Present at the meeting hosted by the Parliamentary Standing Committee on Finance were representatives of crypto exchanges like Binance-owned WazirX and India’s two crypto unicorns CoinDCX and CoinSwitch Kuber, among others. The Blockchain and Crypto Assets Council (BACC) members, industry bodies, and stakeholders were also present in the meeting chaired by the leader of India’s ruling party, Jayant Sinha.

While stakeholder groups have had contact with government officials for many months prior to this official meeting, it was not the first time they met in person.

Issues discussed during the meeting ranged from deliberations about how foreign crypto exchanges should be treated, how to control crypto-related ad campaigns, and how to ensure investor protection to the central bank’s view on the potential threat crypto’s pose to the economy.

India’s central bank (RBI), has frequently called for the government to ban cryptocurrencies. The RBI governor Shaktikanta Das believes digital assets cannot be regarded as “currencies” as they lack intrinsic value.

Das reiterated last week his concerns at the BFSI Insight Summit. He stated that:

The issue of cryptocurrencies is a grave concern. We have serious concerns about them from a macroeconomic and financial stability perspective. RBI made detailed suggestions to government officials and is actively considering the issue.

Although the governor was skeptical of cryptocurrencies in the past, he stated that it is up to the government to make the ultimate decision. He stated that India had a large number of crypto investors. However, the government has repeatedly admitted that they do not have concrete information about the market.

The RBI had attempted in 2018 to put an end to digital currencies. It urged all regulated banks not to offer crypto-related services and asked them to do so. In early 2020, however, the apex court rejected the request.

Following a Saturday meeting presided over by Prime Minister NarendraModi that addressed possible use of crypto currencies for terrorist financing and money laundering, the Parliamentary Meeting was held.

The proximity of these two meetings suggests that government officials intend to establish a crypto regulatory system as soon as possible. It is possible that they are looking to bring the cryptocurrency bill to parliament in the winter session, which will begin later this month.

Fears of a blanket ban that has haunted the Indian crypto space for years have been dispelled following the series of meetings, along with finance minister Nirmala Sitharaman’s consistent reassurances that crypto will not be shut out.

Crypto exchanges have struggled to provide payment options for clients to date as banks have withdrawn or avoided this industry altogether.

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