The Indian Government reportedly will decide and finalise the crypto consultation paper. This consultation paper will comprise inputs from other stakeholders and institutions such as The World Bank and The International Monetary Fund.
This will then be sent to the federal government. The idea or the motive behind establishing the document is to ensure that India as whole will be under the radar of the international regulatory consensus regarding cryptocurrencies or digital assets.
Ajay Seth, India’s Economic Affairs Secretary mentioned that this consultation paper on crypto is currently very close to being concluded as it is in its final stages. This was talked about at the country’s “ICONIC Week” event which is hosted by the Ministry of Labour and Employment.
Ajay Seth, mentioned that,
Digital assets, whatever way we want to deal with those assets, there has to be a broad framework on which all economies have to be together, We need a global consensus on crypto regulation.
The consultation paper is supposed to provide the country’s stance on crypto. Ajay Seth stated that, this paper would help strengthen India’s stance on the asset by providing “some sort of global regulations”.
The details of the crypto consultation paper hasn’t been disclosed. The clarity around the digital asset has been murky in India and has been also affected by regressive taxation systems. Ever since 2017, the Reserve Bank Of India has passed statements which have talked of how cryptocurrencies are Ponzi Schemes.
After that a few months later, the Central Bank also circulated that commercial banks and lenders and other servicing entities doing business with digital assets shall be prohibited. The IMF mentions that crypto assets are at the moment high on agenda for India.
Ajay Seth also stated that,
Whatever way we want to deal with those assets, there has to be a broad framework on which all economies have to be together.
Related Reading | What Do We Know About India’s CBDC And Its Graded Approach?
There is still no clarity if India is considering an outright ban for the asset. The concerned government official stated that,
Whatever we do, even if we go to the extreme form, the countries that have chosen to prohibit, they can’t succeed unless there is a global consensus.
He further mentions that India is considering the regulations enforced in other countries and then deciding to establish its own digital assets policy,
For any country, if there’s global consensus around the regulations, then again there has to be a broad framework of participation of countries.
At the moment, the ban has been ruled out by India’s Supreme Court in March 2020 as it fell under the label of “unconstitutional”.
Nirmala Sirtharaman, the Finance Minister, stated, that the decision regarding the cryptocurrencies shall not be rushed. It is a matter of time till India finds out what the country’s stance on crypto will be.
Related Reading | India To Levy 28% GST On All Crypto Transactions?
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