The government is considering the blocking of internet protocol (IP) addresses of cryptocurrency companies/exchanges, as a part of its bill to ban digital currencies.
Industry professionals told Business Standard that "by doing so, the government may succeed in blocking known sources of platforms permitting trading and investment of cryptocurrencies. Still, the measure taken will not be foolproof in successfully executing the ban".
Moneycontrol could not independently verify the story.
Also read: Why criminalising cryptocurrencies will set India back
In January, The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 was listed in Lok Sabha's bulletin for the ongoing Budget session. The bill has so far not been introduced and tabled in Parliament.
The bill intends to create a facilitative framework for an official digital currency issued by the Reserve Bank of India (RBI) to "prohibit all private cryptocurrencies in India".
According to Reuters, the bill will criminalise possession, issuance, mining, trading, and transferring of cryptocurrency assets.
Finance Minister Nirmala Sitharaman recently said that India will not shut all options when it comes to cryptocurrency.
In the event of a ban, virtual private networks (VPNs) and other means could potentially be used to trade in digital currencies.
"Various routes — like VPNs, peer-to-peer trading, using cash to buy/sell cryptocurrencies and use wallets outside India to store and transfer cryptos, using part of the money permitted to send abroad for investment within the liberalised remittance scheme limit of $250,000 can be diverted for buying cryptocurrencies — remain loopholes," an industry expert told Business Standard.
