New Committee Report favouring Digital Currencies and tokens

[akhjob]

A new committee report has been released by the Indian Finance Ministry and it seems to be favouring Cryptocurrencies.
You can find the report here - https://dea.gov.in/sites/default/files/Report%20of%20the%20Steering%20Committee%20on%20Fintech.pdf
Edit: You can read through the pages 14-21 of the report.

Looks like all the recent news regarding Crypto in India is throwing light on a positive regulation. What do you guys think?

[1714131847]

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[1714131847]

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[avikz]

It's a 150 pages report and mostly talks about fintech and blockchain technology but not about cryptocurrencies as such. I personally couldn't find anything favorable for cryptos in the report through keyword search. But if you can highlight the page numbers talking about cryptos, we would love that!

The reporting committee is headed by Subhas Chandra Garg who was also heading the IMC report that proposes 10 years jail term. I doubt he has changed his outlook about cryptos that fast!

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Edit:
Page 21:
1.2.3 Digital currencies and tokens -
Here it talks about cryptocurrencies and tokens. However, I didn't find anything favorable as such! It's written for information without talking either positive and negative about it! While the entire report favors fintech and blockchain itself, there's nothing favorable for cryptocurrency in particular. My reading is still on!

[akhjob]

~skip~
But if you can highlight the page numbers talking about cryptos, we would love that!
~skip~

You can read through the pages 14-21 of the report.

However, I will make a brief gist on the points made in the report related to blockchain and cryptocurrencies below -

• Distributed Ledger Technology(DLT) has been considered as a revolutionary emerging technology which offers agility, efficiency and accuracy.
• Blockchain Technology has the potential to improve KYC and AML systems, increase standardization and updation of KYC information, and reduce the costs of completing and maintaining KYC information.
• DLT has potential applications beyond the realm of cryptocurrencies and is being explored to facilitate tamper-proof, decentralized records of flow of commodities and assets across a supply chain, digital identity systems and cross-border payments/remittances.
• Blockchain solution in cross-border payments will include the following features
  
  • Exclusion of intermediaries
  • No need for central banks to ensure intraday liquidity
  • Elimination of data modification to maintain an immutable audit trail
  • Will address data protection and privacy concerns
  • Immediate updation of transaction trail.

• Use of digital tokens resolve the issue of multiple currencies, improves liquidity and capital compliance costs, allows for micro-payments and expedites the payment process, which further eliminates liquidity risks.
• In settlement of securities, blockchain will help avoid intermediaries, trace immutable securities records and transactions, provide a transparent ledger of transactions and automated servicing of securities to parties,
• In Trade Finance, Blockchain avoids falsified receivables and multiple invoices secured against the same collateral due to its transparency and security.
• The regulation of coins or tokens depend on the characteristics and the purpose for which they are being issued. Depending on the objective of issue, tokens can be grouped into two categories:
  
  • Utility tokens: Utility tokens entitle future access to a company’s product or service. These utility tokens can be understood as digital coupons for the service it is developing
  • Security tokens:  Some issuance of digital tokens has the attribute of a security (Referencing the US SEC vs Howey Guidelines) ie. Digital tokens are treated as security when -  there is an investment of money, there is an expectation of profits, the investment of money is in a common enterprise & Any profit comes from the efforts of a promoter or third party.

PS: Some points are parts quoted from the original report, so don't report this post as plagiarism  

[akram143]

When anything about cryptos is not sure in India still media claims that bitcoin is illegal thing in India.Recently I watched a video from reputed news channel that India banned bitcoin and other cryptos in 2018.

[pawanjain]

I never believe a single word that says anything about cryptocurrencies or blockchain from the government of India unless it is from a genuine source.
Whether the information provided is positive or negative I don't trust it until it is from a trusted source. Same goes here.
Could you provide the source from where you got this document. I have not heard anything as such from an official source so I would definitely need to see the source for this one.

[manav24]

I never believe a single word that says anything about cryptocurrencies or blockchain from the government of India unless it is from a genuine source.
Whether the information provided is positive or negative I don't trust it until it is from a trusted source. Same goes here.
Could you provide the source from where you got this document. I have not heard anything as such from an official source so I would definitely need to see the source for this one.

The report is available on Department of Economic Affairs site (https://dea.gov.in/sites/default/files/Report%20of%20the%20Steering%20Committee%20on%20Fintech.pdf) , I am not sure why you think that is not a genuine trusted source?

[erikalui]

They only favor blockchain technology and even Jio will be adopting it but they will never regulate bitcoins (atleast for next 5 years) as they basically aren't interested in innovation. I still don't see them positively talking about it and it's just that the RBI was made to explain why it should be banned and RBI already have an excuse (crypto and money laundering excuses). They are only interested in taxes, taxes and taxes.

[akhjob]

They only favor blockchain technology and even Jio will be adopting it but they will never regulate bitcoins (atleast for next 5 years) as they basically aren't interested in innovation. I still don't see them positively talking about it and it's just that the RBI was made to explain why it should be banned and RBI already have an excuse (crypto and money laundering excuses). They are only interested in taxes, taxes and taxes.

The green highlighted part in my post above shows shows they acknowledge that digital tokens are better than Fiat Currencies and they are talking about regularising the tokens / coins based on their characteristics. Don't you think that something positive in the current considering the previous report which advised a ban?

[erikalui]

The green highlighted part in my post above shows shows they acknowledge that digital tokens are better than Fiat Currencies and they are talking about regularising the tokens / coins based on their characteristics. Don't you think that something positive in the current considering the previous report which advised a ban?

They are talking about digital tokens and not exactly crypto currencies like bitcoins. They have always been favoring blockchain and plan to launch their own digital token and not necessarily regulate the existing ones.

[amishmanish]

--snip--

PS: Some points are parts quoted from the original report(link in OP), so don't report this post as plagiarism  

Good Job summarizing the points akhjob. Whenever you are quoting something verbatim, it is best to put a reference url in that same post or put that text in a quote window. There were mass bans a few months ago as a bot has either been checking for plagiarism or someone is using a bot to do that.

This isn't confirmed but better be safe than sorry. Generally, plagiarism detection can lead to perma-ban and a lot of heartburn with minimum chance of a hearing.  You can edit your post to include a reference URL.


Coming to the report, I feel they have taken a positive view on crypto from the word go. At Page 13, it says "Lending and investment". The peer-to -peer lending being talked about sounds eerily similar to an endorsement of the ICO method of raising investment. Importantly, the report will also serve to strengthen the "RBI vs Exchanges" case as it acknowledges the risks involved and talks about a "Consumer Protection Framework" at Page 78. An overall good sign.

Some of the problems in the report are that it has steered completely clear of the status of virtual currencies viz-a-viz the payment system debate, especially Bitcoin. The way it talks about "ICO's" at page 21, you really have to wonder if the people writing this report in 2019 are naive enough to not include a warning about them..

[pawanjain]

I never believe a single word that says anything about cryptocurrencies or blockchain from the government of India unless it is from a genuine source.
Whether the information provided is positive or negative I don't trust it until it is from a trusted source. Same goes here.
Could you provide the source from where you got this document. I have not heard anything as such from an official source so I would definitely need to see the source for this one.

The report is available on Department of Economic Affairs site (https://dea.gov.in/sites/default/files/Report%20of%20the%20Steering%20Committee%20on%20Fintech.pdf) , I am not sure why you think that is not a genuine trusted source?

LOL, thanks for pointing that out. I didn't know about the site and whether if it's genuine.  My bad!

[eaLiTy]

Lets say that there are multiple committees giving reports but both these reports are giving by Subhash Chandra Garg and i am not sure why he gave two reports to two committees,  IMC and the Steering Committee have two reports and which one will be taken into consideration for the final verdict. It all comes down to the government which one to take into consideration as both the reports are headed by the same person which is weird.
Lets see what the final outcome will be as i do not have any hope with the political system of India.   

[akram143]

Lets say that there are multiple committees giving reports but both these reports are giving by Subhash Chandra Garg and i am not sure why he gave two reports to two committees,  IMC and the Steering Committee have two reports and which one will be taken into consideration for the final verdict. It all comes down to the government which one to take into consideration as both the reports are headed by the same person which is weird.
Lets see what the final outcome will be as i do not have any hope with the political system of India.   

If both reports were from same person then we can't say which will be anything helpful for the crypto existence.

But trust Indian court system,it will take at least 15 years to give a result to a case.

[Clement Kaliyar]

But trust Indian court system,it will take at least 15 years to give a result to a case.

The court hearing has changed several times and i know that this thread is not active for a long time, we have a court hearing on Nov 19 and hopefully we will get to know a new date  .

All the committee news were published for a while and till now there is no update regarding that, any exchange members who is following the case could update about this here on what their business plans are and what they are planning moving forward.

[libert19]

But trust Indian court system,it will take at least 15 years to give a result to a case.

...any exchange members who is following the case could update about this here on what their business plans are and what they are planning moving forward.

Probably, they would be waiting for verdict, if ban they will have to completely close their shop (including p2p, by which some exchanges are surviving) else they (and we) will rejoice.