Following the historic passing of the Bitcoin Law in El Salvador, industry sources indicate that a similar move is under way in India.
Cryptocurrency regulation in India has been on the tighter end in the past year, and continues to be the case with its recent pronouncement against virtual currencies. According to a report by a local media outlet, the Securities and Exchange Board of India (SEB) is overseeing regulations for the country’s cryptocurrency sector, with Bitcoin moving in with a new classification as an asset class.
According to a whitepaper published by Indiatech.org, the adoption of Bitcoin as an alternative asset under the country’s regulatory bodies is more realistic. This is due to the volatility prevalent in the crypto sector, and as is occasioned by the digital nature of these currencies, with rapidly fluctuating prices and projects developing at a rapid scale as well, hence its negative characteristic as a payment instrument. The policy framework can be accessed for full detail here.
“In my opinion, the Indian government will explore a way to regularise Bitcoin. I don’t think India will consider accepting Bitcoin as a legal tender in the near future because it will affect the position of the Indian rupee. Accepting bitcoin as a legal tender is a good idea for those nations who don’t have their own currency or are dependent on the US dollar” opined ItsBlockchain.com Founder Hitesh Malviya.
These new initiatives to create new regulatory frameworks for cryptocurrencies follows the Reserve Bank of India’s (RBI) recent circular, in which it disclosed a memorandum for banks to retrace transactions that involved virtual tokens. The pronouncement makes reference to an earlier circular issued in 2018, which has since been rescinded by India’s Supreme Court.
The country’s prominent crypto and financial technology companies are also said to be in talks with the Ministry of Finance. The initiative aims to create a new set of updated regulations for the cryptocurrency panel, with industry sources indicating that a panel of financial technology and cryptocurrency experts at the ministry has been formed to engage in research on the subject. According to the report, a Cryptocurrency Regulation Bill will likely be proposed to the Indian Parliament during the Monsoon session.
“We can definitely say that the new committee which is working on cryptocurrencies is very optimistic on cryptocurrency regulation and legislation. A new draft proposal will soon be in the Cabinet, which will look into the overall scenario and take the best step forward. We are very hopeful that the government will embrace cryptocurrencies and blockchain technologies,” shared Coinsbit Chief Financial Officer Ketan Surana.
According to the talks held with the Indian government, companies in the crypto and fintech sector have communicated “major concerns” on the subject of digital concerns. These concerns were not identified in detail, however, and would still be a matter of further discussion, according to RBI Governor Shakthikanta Das.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.