Indian Government to Avoid A Complete Ban, Would Regulate Crypto As Assets
The overall view within the government is that the steps taken should be proactive, “progressive and forward-looking,” as crypto is an evolving technology.
There are a lot of rumors coming from India regarding the regulation of cryptocurrencies. As per the latest reports, India will ban the use of crypto for making payments but will regulate the trading of crypto as assets.
While the details of the crypto regulation bill are being finalized, the government plans to present the bill in the parliaments’ winter session, meaning in the next two to three weeks, the Economic Times reported citing government sources.
Authorities are also planning to ban “active solicitation” from crypto firms, including exchanges and platforms in the bill. As a result, cryptocurrency exchanges like WazirX have paused their ads.
“Active solicitation would not be permitted. Details of the bill are being finalised,” a government source said.
The government is reportedly also working on the taxation aspects, and the upcoming legislation is expected to address this.
Proactive & Progressive Approach
For the last few days, the government has held several meetings with crypto representatives for closed-doors discussions between the government and the Reserve Bank of India (RBI).
The exchanges are pushing for a regulatory sandbox. Meanwhile, the central bank has expressed concerns over cryptocurrencies posing a threat to macroeconomic and financial stability as well as capital controls. RBI’s ban on cryptocurrencies was overthrown by the Supreme Court last year.
RBI governor Shaktikanta Das also reiterated this week that the number of crypto accounts in India appears to be exaggerated and that there was a need for a deeper discussion on cryptos.
According to the report, price arbitrage has emerged as a new worry regarding how regulators can keep tabs on multiple exchanges due to “huge price difference and an opportunity for price arbitrage.”
According to the report, a person aware of crypto discussions at a meeting chaired by Prime Minister Narendra Modi on Saturday said that the overall view within the government is that the steps taken should be proactive, “progressive and forward-looking” as it was an evolving technology.
The report added that the Securities and Exchange Board of India (Sebi) could be designated as the regulator, but a “final call” has not been taken yet. “Discussions on regulation are going on,” the source said.