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Indian Government Proposes Law to Build CBDC and Ban Majority of Cryptocurrencies

The Indian government will discuss a cryptocurrency bill during the winter session of Parliament, which proposes to build a CBDC and ban private cryptocurrencies.

In the discussion agenda of the Indian Parliament posted on November 23, observers discovered a bill called the "Official Digital Currency Regulation Bill, 2021" scheduled to be discussed. discuss and approve. The bill will be considered in the winter session of the Indian House of Representatives, which is scheduled to start on November 29 and end on December 23.

The content of the law is to “build a legal framework for the development of an official digital currency to be issued by the Central Bank of India”. This can be seen as a form of national digital currency (CBDC) of the country of billions of people. CBDC is a trend pursued by many countries to deploy their own digital currency, including China and Nigeria that have implemented practical solutions.

In addition, to facilitate the popularization of the coin, the law also proposes to “ban all other private cryptocurrencies in circulation in India”. However, the authorities will make exceptions for certain coins that are “used for promoting the use and technology behind cryptocurrencies.” The most likely crypto coins that fall into this exception will be well-known names like Bitcoin (BitfinexUSD) and Ethereum (ETH/USD).

However, this is not the first time that the proposed law has appeared in the Indian Parliament. During the first session of the year in February 2021, a bill with a similar name was also put on the agenda of the House of Representatives, but it was not discussed.

Despite the news that private cryptocurrencies are banned, CEO Nischal Shetty of India's largest cryptocurrency exchange WazirX insists this is still a positive development. He declared:

“From the 2018 ban on banking transactions to the official Digital Currency Regulation Bill of 2021 discussed during the winter session of Parliament. Our country has come a long way in just three years.”

This sentiment is also reflected in the price movement in the cryptocurrency market. Although there is news that India will ban crypto, major currencies like Bitcoin or Ethereum have not had a negative reaction like the event China banned crypto in September 2021.

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