India Plans To Ban Crypto As Payment Method But Regulate Them As Assets

India To Regulate Cryptocurrencies

The Indian government will not ban cryptocurrencies. Instead, it will regulate them as assets and not adopt them as means of payment. This is according to a report earlier today by the Economic Times.

Per the report, the government is finalizing legislation that will pave the way for the regulation of crypto-asset trading while barring the use of virtual currencies for payments and transactions. The Indian government plans to present a crypto regulation bill in the parliament’s winter session, details of which are currently being finalized.

The latest bill seems to differ from the earlier plans to ban crypto in the country. The government sources told ET that the Securities and Exchange Board of India (Sebi) could be designated as the regulator, although a final call is yet to be taken.

The cryptocurrency regulatory environment in India remains unclear as the government has talked about banning digital currencies in the past. However, the Supreme Court had stopped the Reserve Bank of India from banning cryptocurrency transactions in the past.

Tanvi Ratna, founder and CEO of the think tank Policy 4.0, stated that “Regulating crypto as an asset doesn’t solve all the issues that authorities are concerned about, but it does take it out of the currency arena, which is one of RBI’s worries. The trickiest part is defining the asset class.”

The Indian government held a meeting with crypto industry representatives earlier this week as it looks to find the best way to regulate the crypto market without stifling innovations. In addition to regulating the crypto space, the government is also working on the taxation aspects, and the upcoming legislation is expected to address it.

India, like several countries around the world, continues to struggle to regulate the crypto space thanks to its ever-changing nature.