The Indian Government, as expected, is not looking to completely ban the use of cryptocurrencies in India. Extending on our previous post on the highly anticipated cryptocurrency bill, new information suggests that the Indian Government is looking to regulate cryptocurrencies as assets.
According to a cabinet note, as seen by a media channel, all Indians would be required to declare all their crypto holdings. The note further reportedly highlights that all citizens would be mandated to hold their assets in Indian cryptocurrency exchanges, and not on foreign exchanges or private wallets. Once this bill is passed, citizens will be provided with ample time to transfer their crypto assets to Indian exchanges from any private wallets or foreign exchanges to meet these requirements. The penalties for failing to follow these requirements could be in the range of ₹5 crores – ₹20 crores.
SEBI To Lead the Crypto Regulation Charge
The Securities and Exchange Board of India (SEBI) is highly likely to regulate the Indian cryptocurrency sector, while the RBI will work on developing and monitoring the rumored Indian Central Bank Digital Currency (CBDC). Plans for altering the Prevention of Money Laundering Act to include provisions for cryptocurrencies are reportedly in the works.
This reported move is in line with what industry experts were lobbying for, headed by this five-point framework, as proposed by IndiaTech.org. Nischal Shetty, Founder/CEO of WazirX writes: “All of us Want Regulation. We’ve been pushing it [for] the last 1000+ days. Finally, the regulation process has begun, why panic?” Spokesmen from WazirX further reiterate the necessity of positive regulations – “Even if the bill is 30-40% positive, investors will put more money into India”.
Major players in the Indian crypto industry have been lobbying for regulating cryptocurrencies as an asset class, and not as legal tender for quite some time now. These regulations would very well be extremely beneficial for the Indian cryptocurrency scene.