The Indian government plans to introduce “cryptocurrency measures” this year, according to the country’s Secretary for Economic Affairs, Ajay Seth. India’s finance minister says that cryptocurrency regulation will be discussed at her upcoming G20 meeting of finance ministers and central bank governors.
India could introduce crypto measures this year
India’s Economic Affairs Secretary Ajay Seth reportedly said at a post-budget press conference in Mumbai on Saturday that India will introduce “cryptocurrency measures” this year.
“You can use cryptoactive technology such as blockchain and others, but its use in the financial sector can have various risks,” he said, quoted by local media. The official elaborated:
In the course of this year, measures would be presented around cryptocurrencies.
The Secretary for Economic Affairs added: “In India, no one talks about using cryptocurrencies as currency. The risks are in using it as a token.”
The Indian government has been working on crypto legislation for several years. A crypto bill was introduced in 2019, but never taken up in parliament.
India to discuss crypto legislation with G20 countries
Indian Finance Minister Nirmala Sitharaman reportedly stated in a post-budget interview with Network18 Group on Friday that she will seek to develop a global standard operating procedure (SOP) to regulate crypto assets at her next G20 meeting. Under the Indian presidency, the first meeting of the G20 finance ministers and central bank governors is scheduled for February 24-25 in Bangalore.
sitharaman said:
We will seek to make global SOPs available and agreed to regulate crypto assets while recognizing the central bank as the authority to issue cryptocurrencies.
“The rest of the assets created outside that are using very useful financial technologies. Even those have to be discussed because the regulations cannot be made by a single country, it has to be a collective action because the technology does not admit borders”, pointed out the finance minister.
During his budget speech last week, Sitharaman did not mention crypto assets. However, this year’s finance bill included several new tax penalties related to crypto tax deducted at source (TDS). This year’s Economic Survey 2023 also highlighted the need for “a common approach to regulating the crypto ecosystem.”
India’s central bank, the Reserve Bank of India (RBI), has repeatedly recommended banning cryptocurrencies like bitcoin and ether. Noting that cryptocurrencies could undermine the authority of the central bank, RBI Governor Shaktikanta Das recently said:
If crypto is allowed in India, RBI will lose control over transaction tracking. Crypto, disguised as a financial asset, is a completely misplaced argument.
The governor of India’s central bank has also warned that cryptocurrencies could lead to the next financial crisis if they are not banned. Meanwhile, the RBI is currently testing its central bank digital currency (CBDC), the digital rupee.
Do you think India will introduce measures around cryptocurrencies this year? Let us know in the comments section.
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