India’s own digital cryptocurrency to soon become reality

New Delhi, Feb 01: India's own digital cryptocurrency will soon become a reality, Union Finance Minister, Nirmala Sitharaman announced today in her Budget 2022 speech. The digital currency will be issued by the Reserve Bank of India and this would give a big boost to the economy, she said.

Further the Finance Minister announced a 30 per cent tax on proceeds of virtual or digital assets. It may be recalled that the RBI had said last year that it was working towards its own digital currency.

The RBI has in the past highlighted that cryptocurrencies such as BitCoin, Ethereum and Dogecoin among other pose a risk to financial stability. It also questioned the marker value while asking investors not to get lured by the promises of its returns.

The previous version of the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 had aimed for a ban on private cryptocurrency operators. India had started to explore cryptocurrency regulation in 2017 and an inter-ministerial committee was set up to explore methods to regulate the virtual currency.