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Indian finance minister waiting for consultations to decide whether to ban or regulate crypto

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Another statement from a high-ranking Indian official shows that regulatory confusion over the status of digital assets in the country would linger in the foreseeable future.

Finance Minister Nirmala Sitharaman said she would not “legalise or restrict” cryptocurrency at this time during a general debate of the Union Budget for 2022–23 in the Rajya Sabha, India’s bicameral parliament’s upper chamber. “Banning or not banning” will be under discussion. Once the ministry evaluates the information from the consultations, according to the minister.

Sitharaman further stated that the government has the “sovereign right to tax” money derived from cryptocurrency transactions by residents. Furthermore, the government’s ability to charge crypto taxes is distinct from the problem of the asset class’s legal recognition. This argument is similar to one made earlier this week by the head of India’s tax body. Who stated that the plan to tax digital assets does not imply that trade will be legitimate.

With speculations of a potential ban shaking up the global crypto space in late 2021, India has recently become a hotbed for important regulatory developments. Hence, the immediate threat appears to have passed. Moreover, the bill containing the ban proposal left off the parliament’s agenda for the current session. The Indian government has been working toward launching a central bank digital currency, or CBDC, later in 2022 or 2023. While continuing to consider its choices on crypto assets.

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