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India to introduce revised bill banning some cryptos

By Anoop Agrawal

08:42, 30 November 2021

Cryptocurrency in the form of coins
The Indian government is seeking to ban ‘private’ cryptos such as monero – Photo: Shutterstock

The Indian government will introduce a new cryptocurrency bill in parliament after it clears cabinet, finance minister Nirmala Sitharaman said today.

The Cryptocurrency and Regulation of Official Digital Currency Bill has come up for discussion after revisions on the old bill could not be tabled in previous sessions of parliament, the minister said.

“We are close to bringing a bill in parliament. It will be introduced in the house once cabinet clears the bill,” Sitharaman said during the question in the Rajya Sabha, the upper house of the Indian parliament.

The new bill could not be brought in the monsoon session as there were some other dimensions that had to be considered and a lot of changes came in. The government’s intent was to improve the bill, Sitharaman said.

‘Undesirable activities’

She said the risk that cryptocurrencies can lead to undesirable activities is also being closely monitored and being taken into consideration by the government.

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Short position overnight fee 0.0069%
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Short position overnight fee 0.0069%
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Short position overnight fee 0.0137%
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Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 106.00

“No decision was taken on banning its advertisements. However, steps are being taken to create awareness through RBI Reserve Bank of India and the Securities & Exchange Board of India,” she added.

The new bill seeks to prohibit all ‘private’ cryptocurrencies in India, which some commentators have taken to mean those that have zero transparency, such as monero. However there is concern it might also try to prevent citizens from holding conventional cryptos such as bitcoin and ether.

Earlier this week Sitharaman said the government had no intention of recognising bitcoin as an official currency. Further, she said that the government does not collect data on bitcoin transactions.

Sitharaman said the regulation of non-fungible token (NFTs) is also being discussed by the government.

Read more: Economists poll: India’s July-September GDP growth at 8.3%

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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