August 8, 2024
By Anjali Kochhar
India’s Minister of State for Finance, Pankaj Chaudhary, has confirmed that the Indian government currently has no proposals to regulate the sale and purchase of cryptocurrencies. This announcement, made in a written response to the Lok Sabha, indicates that India’s crypto sector will not see any immediate regulatory changes.
Chaudhary’s comments came in response to questions posed by GM Harish Balayogi, a member of parliament, who inquired about the government’s stance on potential regulations for virtual assets. The Minister clarified that while there are no plans to introduce legislation for regulating virtual digital assets (VDAs) in the near future, the Financial Intelligence Unit India (FIU-IND) has been tasked with overseeing VDSAPs (Virtual Digital Asset Service Providers) under the Prevention of Money Laundering Act, 2002 (PMLA). This oversight aims to address issues related to Anti Money Laundering (AML) and Countering the Financing of Terrorism (CFT).
In addition to the regulatory uncertainty, Chaudhary revealed that the government does not collect data on the crypto sector, citing its current unregulated status as the reason. This lack of data collection underscores the broader issue of regulatory uncertainty that has been a point of concern for India’s crypto businesses.
Despite these developments, India has been actively engaged in global discussions regarding crypto regulations. During its G20 Presidency last year, India collaborated with the International Monetary Fund (IMF) and the Financial Stability Board (FSB) to create a roadmap for global crypto regulation. Chaudhary noted that all G20 nations are currently evaluating the potential benefits and risks of cryptocurrencies. The next steps involve working with global standard-setting bodies to consider appropriate measures for managing crypto assets.
Sharat Chandra, founder of blockchain-focused EmpowerEdge Ventures, commented on the situation, stating that the lack of immediate regulatory action from India is indicative of the government’s stance to await a global consensus on crypto regulation. This reflects a cautious approach towards integrating cryptocurrencies into the country’s financial system until a more uniform global framework is established.
The Reserve Bank of India (RBI) is getting closer to implementing its plans for a digital currency even though the regulatory environment is still unclear. According to reports, the RBI is continuing the eRupee Central Bank Digital Currency (CBDC) testing in association with well-known UPI applications such as Google Pay, PhonePe, and Amazon Pay. The government’s continued interest in digital financial innovations is indicated by this project, even though more extensive crypto legislation are still on hold.
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
