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India to release position on cryptocurrency by September after stakeholder consultations: Report
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India plans to release a discussion paper outlining its policy position on cryptocurrencies by September, according to Ajay Seth, a senior finance ministry official.
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In September 2023, Seth said that India would analyze and decide its own position on crypto in the “coming months” . “
India plans to release a discussion paper outlining its policy position on cryptocurrencies before September, Indian media reports Money Controlquoting an interview with Economic Affairs Secretary Ajay Seth.
Seth’s interview does not suggest a commitment to regulating crypto through comprehensive legislation, but rather a position based on stakeholder consensus on the issue.
“The policy position is to consult with relevant stakeholders. So you have to come out and come up with a discussion paper, the issues, and then stakeholders will give their views,” said Seth, the secretary of state for economic affairs. “Right now, there is an inter-ministerial group looking at a broader policy for cryptocurrencies. We hope to have the discussion paper out before September.”
The inter-ministerial group includes India’s central bank, the Reserve Bank of India (RBI), and the market regulator, the Securities and Exchange Board of India (SEBI). The RBI has been opposed to legitimizing cryptocurrencies or stablecoins, instead seeking to ban them because it believes digital assets pose risks to the emerging nation’s macroeconomic stability. SEBI has not opposed regulating digital assets and recently said that Cryptocurrency trading oversight should be outsourced in several authorities.
India does not have a comprehensive crypto legislation, but it does have imposed high taxes on the sector. However, it introduced a requirement for crypto entities to register with the country’s Financial Intelligence Unit (FIU-IND) to adhere to anti-money laundering (AML) and counter-terrorist financing standards set by global bodies such as the Financial Action Task Force (FATF), marking a change of credibility for industry.
“In India, cryptocurrencies are regulated only from the perspective of anti-money laundering and electronic funds transfer (EFT). The regulation starts and stops there, it cannot go further. So should the mandate be broader? What should be the policy position? All this will come out in the discussion paper,” Seth said according to the report.
In September 2023, Seth said that India would analyze and decide its own position on crypto in the “coming months“after reviewing the position of world leaders on an acceptable crypto regulatory framework. This statement was made on the sidelines of India’s chairmanship of the Group of 20, during which it had prioritized the development of consensus-based global crypto rules.
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