Crypto Money Laundering, Terrorist Financing Problems, and PM Chairs Meet

Amid concerns over false claims of huge returns on digital currency investment, Prime Minister Narendra Modi led a transit rally on the issue on Saturday, with government sources saying such unregulated industries cannot not be allowed to become avenues for “money laundering and terrorist financing”. It was unequivocally felt at the rally that efforts to deceive young people through overly promising and non-transparent ads should be stopped, the sources said, signaling that strict regulatory measures are in sight.

The government will continue to proactively engage with experts and other stakeholders, sources added, noting that since the problem transcends geographic boundaries, it was felt that it will also require global partnerships and collective strategies.

“The government realizes that this is an evolving technology, it will monitor closely and take proactive measures. There was also a consensus that the measures taken in this area by the government will be progressive and forward-looking, ”said a source.

The meeting on the way forward for cryptocurrency and related issues was very comprehensive.

The RBI has repeatedly reiterated its firm stance against cryptocurrencies, claiming that they pose serious threats to the country’s macroeconomic and financial stability and has also questioned the number of investors trading there as well as their market value. claimed.

“It was also the result of a consultative process as the RBI, the Ministry of Finance, the Ministry of the Interior had carried out an elaborate exercise on this subject as well as consulted experts from all over the country and the world. Global examples and best practices were also reviewed, ”the source said.

RBI Governor Shaktikanta Das reiterated his views against the authorization of cryptocurrencies on Wednesday, saying they pose a serious threat to any financial system because they are not regulated by central banks.

His comments precede the RBI’s internal panel report on the contentious subject which is expected next month.

The Supreme Court canceled the RBI circular banning cryptocurrencies in early March 2020. As a result, on February 5, 2021, the central bank instituted an internal panel to propose a central bank digital currency model. The RBI had announced its intention to release an official digital currency, in the face of the proliferation of cryptocurrencies like Bitcoin about which the central bank had many concerns.

Private digital currencies / virtual currencies / crypto currencies have grown in popularity over the past decade or so. Here, regulators and governments have been skeptical about these currencies and fear the associated risks. It can be noted that on March 4, 2021, the Court of Cassation canceled an RBI circular of April 6, 2018, prohibiting banks and entities regulated by it from providing services in the field of virtual currencies.

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