The Indian government isn’t looking to ban cryptocurrencies in the country, but it is looking to regulate them — as ‘assets’. The country’s markets’ watchdog, the Securities and Exchange Board of India (SEBI), will be at the helm, according to a cabinet note seen by NDTV.
This conforms to what Finance Minister Nirmala Sitharaman said earlier this week about Bitcoin not being recognised as a currency for payments in India. India is, however, working on its own central bank digital currency (CBDC) that will be governed and monitored by the Reserve Bank of India (RBI).
The note also reportedly highlights that citizens will need to declare their crypto assets and keep them on Indian exchanges. They will no longer be allowed to keep crypto on foreign exchanges or in private wallets.
Once the bill becomes law, people will be given some time to transfer their holdings to meet these requirements. Failing to do so could result in penalties within the range of ₹5 crore to ₹20 crore.
Moreover, India has plans to amend its Prevention of Money Laundering Act (PMLA) to make provisions for cryptocurrency activity. According to Sitharaman, the government is closely monitoring the risks that cryptocurrencies present. Even Prime Minister Narendra Modi highlighted the volatile nature of digital tokens in November, calling on global cooperation from democratic nations to regulate the sector and protect the youth.
“The industry has been actively communicating with all stakeholders keeping investor protection at the forefront,” Ashish Singhal, the founder and CEO of CoinSwitch Kuber and the co-chair of the Blockchain and Crypto Assets Council (BACC), told Business Insider India.
Where does India Crypto Bill Stand?
India’s proposed laws on how to regulate cryptocurrencies and other aspects of the crypto sector — including decentralised autonomous organisations (DAOs), non-fungible tokens (NFTs), and the metaverse — is on the agenda of the ongoing session of Parliament in the lower house, the Lok Sabha.
According to Sitharaman, the bill is pending approval from the Cabinet before it can be introduced to the Members of Parliament (MPs).
“Even if the bill is 30-40% positive, investors — family offices, traditional VC firms — will put more money into India, if something positive comes out,” WazirX’s head of public policy, governance issues and content, Aritra Sarkhel, told Business Insider during a sponsored webinar.
The article originally published on Business Insider.