There has been a buzz for quite some time, about India — the world’s fastest growing digital payments market — to bring out a lw on cryptocurrency. The buzz gathered steam when Prime Minister Modi held long meetings around the same, even giving out a public statement or two on the issue. And looks like, we could soon have a new cryptocyrrency law in the country.
It seems that a compromise has been reached – while cryptocurrency will continue to be prohibited from being used in transactions or making payments, it may be held as an asset, like gold, bonds, or shares, according to various reports and sources within Indian government.
This means that active solicitation by companies, including exchanges and platforms, will be barred. According to an ET report, the government will not be implementing a complete ban, even though it is keen to stop crypto companies, including exchanges and platforms, from actively trying to attract new investors.
This come after PM Narendra Modi had chaired a meeting to discuss the future of cryptocurrencies in the country, even as regulators are concerned that unregulated crypto markets could lead to money laundering and terror financing.
The RBI has maintained a strong stance against cryptocurrency for a long time, expressing concerns over potential risks to macroeconomic and financial stability, and capital controls. In fact, RBI Governor Shaktikanta Das recently said that there was a need for deeper discussions and a lack of a well-informed debate in the public domain.
According to a person aware of discussions at that meeting, the overall view within the government was proactive, saying that “progressive and forward-looking” steps should be taken, since cryptocurrencies represented an evolving technology. ET also reported that the details of a bill were still being finalized and that the cabinet could receive the proposed legislation in the next two to three weeks for its consideration.
It is likely that the Securities and Exchange Board of India (SEBI) could be designated as the regulator of crypto in India, but that has not been finalized yet.