India Analyzes Cryptos, Noting Changes In Global Perception

India analyzes cryptos, noting changes in global perception

Despite regulations, the country’s investments in virtual asset remain significant

India's Economic Affairs Secretary Ajay Seth has stressed the need for a non-unilateral approach towards cryptocurrencies, citing changes in other jurisdictions, particularly after U.S. President Donald Trump's recent crypto regulations.

As global perception changes, an analysis of the discussion paper, due in September 2024, is underway. However, the review could be delayed, as Seth explained, "More than one or two jurisdictions have changed their stance towards cryptocurrency in terms of the usage, their acceptance, where do they see the importance of crypto assets. In that stride, we are having a look at the discussion paper once again.”

He added that because such assets "don't believe in borders", India's stance cannot be unilateral. However, he did not directly mention Trump’s order to overhaul U.S. crypto policy by creating a working group tasked with proposing new digital asset regulations and creating a national cryptocurrency stockpile.

Meanwhile, in recent years, Indians have poured money into cryptocurrencies, despite the country's tough regulatory stance and steep trading taxes.

In December 2023, India's Financial Intelligence Unit (FIU) issued show-cause notices to nine offshore cryptocurrency exchanges for non-compliance with local rules.

In June 2024, Binance, the world's biggest crypto exchange, was fined Rs.188.2 million ($2.25 million), a month after registering with the FIU, to resume operations in India.

Recently, India's market watchdog recommended that several regulators oversaw trade in cryptocurrencies. This indicated that certain authorities were open to the use of private virtual assets.

This contrasted with the Reserve Bank of India (RBI), which has maintained that private digital currencies represent a macroeconomic risk.