New Delhi, November 16 : .The government faces deeper problems than just addressing the question of legitimizing cryptocurrencies in India with the upcoming bill.
Crypto could be misused for money laundering and hawala, and investments of billions of dollars are escaping to overseas.Capital gains tax is also being avoided by trade exchanges and investors, Subhash Chaudra Garg, ex-Finance Secretary of India said Tuesday.
While Finance Minister Nirmala Sitharaman had emphasised that not all windows on cryptocurrencies will be shut down, Garg, a pioneer in formulating policies around crypto, sees a lot of new and serious concerns coming through those windows, as the policymakers struggle to find answers as to how to deal with the highly-volatile crypto situation.Although Nirmala Sitharaman, Finance Minister, had stressed that not all windows regarding cryptocurrencies would be closed, Garg is a pioneering policymaker in the field of crypto.
He sees many new and grave concerns through these windows as policymakers try to figure out how to handle the volatile crypto environment.
“Crypto was not created in India.India did not create crypto.Our people are now buying those digital coins via various exchanges and apps (several of them listed at foreign shores) without understanding the inherent risks.
These digital coins are being purchased by our people via various apps and exchanges (some of which list at foreign shores), without realizing the risks.Billions of dollars worth of wealth is being transferred abroad sans any capital gains tax.Wealth worth billions of dollars is being moved abroad without any capital gains taxes.We have so much regulation on foreign currency exchanges and here we have no regulation on crypto exchanges, which is a huge policy concern,” Garg told IANS.
Garg stated to IANS that there is so much regulation for foreign currency exchanges.However, crypto exchanges are not regulated at all.
Garg headed the inter-ministerial committee (IMC) that drafted the cryptocurrency bill entitled “Banning of Cryptocurrency and Regulation of Official Digital Currency Bill, 2019”.Garg was the head of the Inter-ministerial Committee (IMC), which drafted the cryptocurrency bill, “Banning of Cryptocurrency Regulation of Official Digital Currency Bill 2019, 2019”.
The government aims to table the crypto bill in the winter session of the Parliament commencing from November 29, amid grave concerns now being raised over the misuse of digital coins on the Dark Web for terror acts and drug trafficking by militant organisations, money laundering and hawala-based transactions — posing a severe threat to the national security and a big challenge to the security agencies in India.In light of grave concerns about the use of cryptocurrency on the Dark Web to facilitate terror acts, drug trafficking, money laundering and hawala transactions by militant organizations, the government plans to present the bill to crypto parliament in winter session.
This is a serious threat to India’s national security as well as a major challenge for the Indian security agencies.
On Saturday, when Prime Minister Narendra Modi chaired a high-level meeting on the subject, concerns were flagged over lack of transparency in the industry, as this can lead to terror financing through money laundering.Satuday’s high-level meeting was chaired by Prime Minister Narendra Modi.There were concerns about lack of transparency within the industry.
This can result in money laundering and terror financing.
The government is also not happy with crypto players like CoinSwitch Kuber, CoinDCX and WazirX placing “irresponsible” ads across platforms, especially during the IPL 2020 and the ICC Men’s T20 World Cup matches.
Additionally, the government doesn’t like crypto players such as CoinSwitch Kuber and CoinDCX posting “irresponsible ads” across various platforms during IPL 2020 or the ICC Men’s T20 World Cup games.
According to Garg, the trading exchanges that have recently mushroomed have deep business interests in mind and making money is obviously the primary motive.
Garg says that the traders who have opened up trading platforms in recent years have business motives and are primarily motivated by making money.
“These exchanges are operating outside the ambit of the law of the land and are desperate to get legitimised.
These exchanges operate outside of the laws of the country and want to be legitimised.If the figure of Indians investing over Rs 6 lakh crore as quoted in reports is true, the government cannot ignore this, as a crypto crash or a bubble burst will leave millions of innocent investors shattered,” Garg emphasised.Garg stressed that if the reported figure of Indians spending over Rs 6 lakh crore is accurate, then the government must not ignore it as a crash in crypto or bubble will cause millions to lose their investments.”
The government must be reasonably concerned with this kind of massive investment in something which is yet to come under the legal ambit.This kind of huge investment must concern the government in a way that is not yet legal.
“People losing their money via crypto platforms would put the government in a tough situation.
The government would be in trouble if crypto-platform users lose their funds.It has to figure out tough laws before any such situation arises,” added the former Finance Secretary who took voluntary retirement from service in 2019.
The government must devise tough laws to prevent such a situation from ever happening,” said the ex-Finance Secretary, who retired in 2019 after voluntarily retiring.
“Crypto being used as a currency is no more the big concern; the real issue is its potential misuse in various ways that worries me a lot, as this cannot be controlled by the way of regulation only.
The issue of cryptocurrency being used to make money is not the main concern.It is the potential for its misuse in different ways that I worry a lot.This cannot be managed by regulation alone.The government must see what is coming from those windows and plug the loopholes before it gets too late,” he told IANS.
He told IANS that the government should be able to see through those cracks and close any loopholes as soon as possible.
(Nishant Arora can be reached at [email protected]).You can reach Nishant Arora at [email protected]
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