Cryptocurrency Regulation: The Indian government is making strides, the report says

India is planning progressive and forward-looking measures on cryptocurrency-related issues, a move that could be a move away from its previous attempts to limit the use of virtual currencies, according to people familiar with the matter.

Prime Minister Narendra Modi led a review meeting on digital currency on Saturday and it was agreed that the government will continue to proactively engage with experts and other stakeholders on evolving technology, people said, asking not to be identified.

A spokesperson for the prime minister’s office declined to comment.

There have been calls in India to impose stricter rules for virtual currency transactions as an unregulated environment can push more internal savings into the asset class and could endanger household savings.

India has had a hot and cold relationship with digital currencies in recent years. In 2018, it effectively banned crypto transactions after a string of fraud following Modi’s sudden decision to eliminate 80% of the nation’s currencies, but the Supreme Court overturned the restriction in March 2020.

The Reserve Bank of India remains a critic, but is now working on a digital currency. The government could present a cryptographic bill for government approval.

The meeting also concluded that attempts to mislead the country’s younger generation through overly promising and opaque advertisements should be stopped, people said. It was also discussed that it is not possible to allow unregulated crypto markets to become avenues for money laundering and terrorist financing, they said.

The meeting also looked at global examples and best practices, people said. It was highlighted that India should seek global partnerships and collective strategies on the issue, they said.

India’s parliamentary finance panel will meet industry experts and associations on the challenges and opportunities in crypto finance on Monday.


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