Indian Government Updates Progress on Crypto Regulation

[Ozark]

The Indian government has reportedly provided an update on its progress toward the country’s regulatory framework for cryptocurrencies. The government provided its latest stance in areas such as the national cryptocurrency and licensing of crypto businesses. It is pursuing crypto regulations “with due caution,” according to reports.

No Specific Timeline

The Indian Ministry of Finance has reportedly answered some questions regarding cryptocurrencies asked by Lok Sabha, the lower house of India’s bicameral parliament. A document circulating on social media details five questions as well as their answers by Shri Pon Radhakrishnan, Minister of State in the Ministry of Finance. According to the document, the questions were to be answered on Dec. 28.

One of the questions concerns the composition of the panel established to draft crypto regulations, its recommendations, and “the timeline for the expected release of the regulation,” the document reads.

The minister explained that the government has constituted an inter-ministerial committee “under the chairmanship of Secretary, Department of Economic Affairs, with representatives from concerned departments to study all aspects of cryptocurrencies and crypto-assets including bitcoin.” The committee includes representation from the Ministry of Electronics and Information Technology, the Reserve Bank of India (RBI), the Securities and Exchange Board of India, and the Central Board of Direct Taxes. The answer to this question reads:

"In absense of a globally acceptable solution and the need to devise [a] technically feasible solution, the department is pursuing the matter with due caution. It is difficult to state a specific timeline to come up with clear recommendations."

This document surfaced after the media reported on the panel recommending a ban on crypto transactions and another report claiming that there were recommendations to legalize cryptocurrencies with strong riders. Both cited anonymous sources.

National Crypto and Licensing

In response to the question of legality, the minister wrote, “The government has not recognised cryptocurrencies as legal tender. The issue of permitting trading in cryptocurrencies is currently under examination by an inter-ministerial committee.”

The government also denied keeping track of the value of cryptocurrencies traded by Indian nationals within the country. Regarding licensing or authorizing any entities or businesses to deal with bitcoin or other cryptocurrencies, the minister confirmed:

"No decision on licensing and authorising any entity or company to operate such schemes or deal with bitcoins or any virtual currency has been made as yet."

Lastly, the minister also revealed that the committee “is examining all issues, including the pros and cons of the introduction of an official digital currency in India.”

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