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India to set maximum penalty for violating crypto norms at fine of $2.7 million or 1.5 years in jail

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According to BloombergQuint (Bloomberg India), non-compliance with the Indian government’s crypto laws could result in a fine of up to 20 crore rupees ($2.7 million) or a sentence of up to 1.5 years in jail. Prime Minister Narendra Modi is likely to set a deadline for cryptocurrency investors. In order to comply with new regulations and report their holdings. While the country’s regulatory landscape is still in flux, sources suggest that investors’ crypto may soon have to be housed on exchanges regulated by the Securities and Exchange Board of India, or SEBI.

As a result, under the proposed legislation, private wallets would be illegal. And investors who used them could face the aforementioned legal consequences. Modi’s government also intends to establish a minimum capital requirement for cryptocurrency investments.

Due to a perceived increase in fraud, money laundering, and terrorist financing in recent years, India is taking a strong position against cryptocurrency. Another factor is that the Reserve Bank of India’s efforts to develop a digital rupee could be jeopardised by competition from privately held or issued cryptocurrencies. The following is the official text of a contentious crypto law which currently going through debate in the country:

“To establish a structure that will make it easier for the Reserve Bank of India to create its own official digital currency. The Bill also aims to outlaw all private cryptocurrencies in India. But it makes exceptions to promote cryptocurrency’s core technology and applications.”

Regulating crypto instead of banning them

Indian nationals, on the other hand, must reveal details about their digital assets. And transfer them to crypto exchanges regulated by the Securities and Exchange Board of India (SEBI). According to NDTV, such information was part of the accompanying note to the government’s draught law on cryptocurrency under discussion.

Investors will also have a set amount of time to meet the conditions. According to reports in the press, authorities may outlaw non-custodial wallets. As a result, the fight against money laundering and terrorist financing will have an impact on the latter.

The prohibition on most “private cryptocurrencies”, which sparked a brief panic on local cryptocurrency exchanges, is certain.

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