Indian Government Looking into Crypto Token Use for Public Sector
India’s government is reportedly looking into use cases for crypto tokens in the public sector, in spite of the current ban on decentralized cryptocurrencies instated by the country’s banks.
The same governmental committee which was appointed to study and create regulations for cryptocurrency-related matters is also exploring what appliances crypto tokens might have in the public sector, according to sources cited by publication DNA India.
It has been reported that the committee is considering using a custom blockchain-based crypto to represent fiat currency in a tokenized way as opposed to directly substituting the currency on its own. Such token will be used as metro card tokens.
A senior official from the country’s finance ministry stated in the report:
“The committee is examining if crypto tokens can be used to replace smart cards such as metro cards in the public sector to start with. Similarly, in the private sector, it can be used in loyalty programs such as air miles where its use is limited to buying the next ticket and can’t be converted into money”.
The Inter-Ministerial Committee (IMC), first created by the Ministry of Finance last year, comprises out of India’s Department of Economic Affairs (DoEA), India’s taxation authority, and several other ministries in conjunction with representatives from the country’s central bank and the State Bank of India, the nation’s largest bank.
The committee has the specific task of looking into the status of cryptocurrencies both nationally and internationally, examine regulatory and legal agendas implemented by other countries in addition to studying measures to reduce money laundering worries before finally issuing national regulations for cryptos.
While the committee is mulling over the proposal with major postponements, India’s central bank issued a ban in April 2018 which prohibited all regulated financial institutions including banks to not offer any of their services to all cryptocurrency companies.
“This is a difficult subject, involving technology which is changing every now and then. That’s why it is taking some time,” DoEA secretary and head of the IMC Subash Chandra Garg told DNA, despite a televised June interview wherein the official stressed the committee was “in a position to wrap this up [crypto regulations] in the first fortnight of July.”