Economic Times on Friday, reported that undisclosed government officials revealed that India once again, is discussing plans to completely outlaw cryptocurrencies and initial coin offerings (ICOs). The idea was also supported by a number of government departments.

Government agencies confirmed to have supported the idea are the Central Boards of Direct and Indirect Taxes, Investor Education And Protection Fund Authority(IEPF) and the Department of Economic Affairs (DEA), all of which have citizens protection interests along lines of finance and fund usage.

Impact on the digital Rupee launch

Although the country’s central bank was previously considering launching a digital Rupee, the term “digital currencies” as contained in a draft bill titled “Banning of Cryptocurrencies and Regulations of Official Digital Currencies Bill 2019”, now circulating among some government departments may have impact on that policy.

Allegation that many cryptocurrencies are a “modified” ponzi scheme

The concerned government departments are expected to report their feedback in May and a final bill is also expected to follow.

India’s Ministry of Corporate Affairs believes that many cryptocurrencies are a “modified” ponzi scheme and should be classified fraud. Therefore, the ministry proposed that cryptocurrency-related law should be enacted as a part of the country’s anti money laundering policies.

According to the CEO of the investor Education and Protection Fund (IEPF) authority, Anurag Agarwal,

“When it comes to investor protection, the IEPFA has to take a stand against certain things. Against Ponzi schemes, we are taking a stand. We think that cryptocurrency is a Ponzi scheme and it should be banned.”