India is negotiating a complete ban on cryptocurrencies, and the future of cryptocurrencies in India is worrying

Indian government departments are discussing a draft bill to completely ban the use of cryptocurrencies, local media The Economic Times reported on April 25.

An official familiar with the matter reportedly told The Economic Times that the government has begun inter-ministerial consultations on the draft “Banning of Cryptocurrencies and Formal Regulation of Digital Currencies Bill, 2019.”

The committee, which includes India’s Department of Economic Affairs (DEA), Central Board of Direct Taxes (CBDT), Central Board of Indirect Taxes and Customs (CBIC), and Investor Education and Protection Fund Authority (IEPFA), supported a complete ban on “the sale, purchase and issuance of all types of cryptocurrencies.”

The committee is also considering banning the use of digital currencies under the Prevention of Money Laundering Act (PMLA) as they can be used for money laundering. The Ministry of Corporate Affairs reportedly said that cryptocurrencies are being used in fraudulent schemes targeting gullible investors.

The Economic Times report contradicts its own report from December, which said a different government committee recommended that the country legalize cryptocurrencies and stressed that there is a widespread consensus that cryptocurrencies cannot be considered completely illegal.

In February, the Supreme Court of India gave Indian authorities four weeks to formulate a cryptocurrency regulation policy, after which the court will stop hearing cryptocurrency-related cases, including petitions from parties seeking the Reserve Bank of India to revoke its crypto ban.

In the same month, a panel led by India’s economic affairs minister released a report stating that cryptocurrencies are increasingly becoming a means of payment, which has a significant impact on local fiat currencies.