Crypto regulations in India postponed till end of year
India’s hard-line approach to cryptocurrencies has softened very little over the past year and regulations on the industry are still not expected until the end of the year.
Originally scheduled for the end of July, proposals for the regulation of the crypto investment sector are now only likely to come around the year end as a specially-appointed panel of the finance ministry mull their regulatory approach.
The panel was set up in December 2017, led by Subhash Chandra Garg, secretary of the department of economic affairs. Sources quoted by Indian fintech magazine Quartz suggest the panel’s key concern is how to draw up regulations aimed at pushing the use of blockchain independently of the digital currency that supports the technology.
“Blockchain is an interesting thing. We definitely want to milk it effectively for financial transactions. So all officials are really trying hard to understand how to separately use blockchain, without cryptocurrency,” Quartz’s source said.
Narendra Modi’s government appointed a previous panel in April 2017 comprising officials from the finance ministry, the Reserve Bank of India and financial regulator the Securities and Exchanges Board of India.
Choking off support
The hard-line approach to crypto assets was very apparent at this point and this panel recommended choking off any support for the crypto sector.
Arun Jaitley, finance minister, said – even as late as February – in his budget speech: “The government does not recognise cryptocurrencies as legal tender or coin and will take all measures to eliminate the use of these crypto-assets in financing illegitimate activities or as part of the payments system.”
The Garg-led committee has taken a more lenient stance, and is said to be mulling a regulatory approach that would treat cryptocurrenies as commodities.