India Holds Off on Cryptocurrency Regulation Amid Economic Uncertainty

John Darbie
Photo: Finoracle.net

India Holds Off on Cryptocurrency Regulation Amid Economic Uncertainty

The Ministry of Finance states that India does not currently have any plans to regulate cryptocurrency transactions. The government is assessing the risks and benefits of cryptocurrencies, aiming for a policy by September 2024.

Current Stand on Cryptocurrency Regulation

Recently, GM Harish Balayogi, a member of the Lok Sabha, raised questions about the country's laws governing virtual digital assets (VDAs). Pankaj Chaudhary, the Minister of State for Finance, responded in writing, emphasizing that India does not gather data on cryptocurrencies and they remain unregulated in the country. Chaudhary stated, "At this time, there isn’t a proposal to introduce laws in the nation to control the buying and selling of virtual digital assets."

Government Evaluates Risks Without Immediate Regulation

The Minister mentioned that the Financial Intelligence Unit India (FIU-IND) has been authorized to designate Virtual Digital Asset Service Providers (VDSAPs) as Reporting Entities under the Prevention of Money Laundering Act, 2002 (PMLA) for specific oversight purposes, including anti-money laundering (AML) and counter-terrorism financing (CFT). Law Enforcement Agencies (LEAs) are also responsible for addressing illegal actions in accordance with existing legal regulations.

Despite the absence of specific laws to regulate cryptocurrency, current regulations give law enforcement agencies, including the Reserve Bank of India, the authority to act against illegal activities. The Indian government is actively involved in global discussions on cryptocurrencies. Under India's leadership, the G20 adopted a roadmap on crypto assets, setting the stage for a comprehensive policy approach. The government aims to provide a discussion paper outlining its stance by September 2024.

Emerging Acceptance of the e-Rupee

Meanwhile, the e-rupee, India’s central bank digital currency (CBDC), is gaining acceptance, with significant interest from major payment businesses. As the landscape evolves, Indian investors and cryptocurrency-related organizations need to stay informed about regulatory changes and navigate the existing frameworks strategically.

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John Darbie is a seasoned cryptocurrency analyst and writer with over 10 years of experience in the blockchain and digital assets industry. A graduate of MIT with a degree in Computer Science and Engineering, John specializes in blockchain technology, cryptocurrency markets, and decentralized finance (DeFi). His insights have been featured in leading publications such as CoinDesk, CryptoSlate, and Bitcoin Magazine. John’s articles are renowned for their thorough research, clear explanations, and practical insights, making them a reliable source of information for readers interested in cryptocurrency. He actively follows industry trends and developments, regularly participating in blockchain conferences and webinars. With a strong reputation for expertise, authoritativeness, and trustworthiness, John Darbie continues to provide high-quality content that helps individuals and businesses navigate the evolving world of digital assets.