The Indian government plans to introduce a bill to prohibit “private cryptocurrencies,” paving the way to outlaw the likes of bitcoin. The law is set to facilitate the creation of the nation’s own official digital currency.

The ‘Cryptocurrency and Regulation of Official Digital Currency Bill’ was put on the government’s agenda, according to a bulletin, released by the lower house of parliament earlier this week. The proposed law could be discussed in several sessions, the first of which could be held as early as next week.

The legislation moves to prohibit what it calls “all private cryptocurrencies in India,” but allows “certain exceptions” to promote blockchain, the underlying technology of cryptocurrency and its uses. It also aims to provide a framework to set up an official digital coin, issued by the Reserve Bank of India.

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The central bank previously said that the government has long been skeptical about the rising popularity of crypto assets and the risks associated with them. However, the regulator said it was considering whether there is the need for a digital version of fiat currency and the possible ways to use it.

The difference between national digital currencies and the likes of bitcoin is that the former are centralized – issued by central banks and pegged to fiat currencies, the rupee in India’s case. On the other hand, most popular cryptocurrencies such as bitcoin have no central bank or other government agent to hold customers’ funds. (RT)