The Law Commission of India has recognized cryptocurrency as a means of electronic payment. The pronouncement came during the Commission’s recent feasibility study of the legality of online gambling in the country. Cryptocurrency enthusiasts in India will most likely welcome this news given the negative view held by many government officials towards virtual currencies.
Law Commission Groups Cryptocurrency with Electronic Payment Channels
According to a report issued by the Law Commission:
Gambling transactions should be made cashless, making use of electronic means of payment such as credit cards, debit cards, net-banking, virtual currencies (VC, or cryptocurrency), etc.
The idea of cryptocurrencies gaining any form of recognition is one that appeals to crypto enthusiasts in the country. Commenting on the ruling, Nischal Shetty, the CEO of WazirX, a local cryptocurrency exchange platform said:
It is the first time that a body appointed by the government has given recognition to virtual currencies that they have value and can be used for a transaction. Therefore, it is a very positive sign, especially considering the report has come out after a lot of deliberation.
Presently, virtual currency regulation is a significant topic in India. The Reserve Bank of India (RBI), the country’s apex bank, has prohibited local banks from facilitating cryptocurrency transactions in the country. This situation has led to a public outcry with multiple suits filed to challenge the RBI ban.
Regulation is Better than Prohibition
The ruling offered by the Law Commission of India throws into sharp relief an important debate of which is more desirable – regulation or prohibition. The Commission’s mandate was the examine the case for legalizing betting while treating match-fixing as a criminal offense.
The same principle could also be applied to the government’s stance on cryptocurrency and the RBI ban. Commenting on this analogy, Tuhina Joshi, an associate at TRA Law, a firm with many cryptocurrency exchange platform clients, said:
The law commission recommends that regulating gambling is preferable to an outright ban. This is the same argument we are making in [the] context of cryptocurrencies.
Do you think the ruling of the Indian law commission will lead to a reversal of the RBI ban? Let us know your thoughts in the comment section below.
Image courtesy of the Law Commission of India