Crypto can be licensed as an asset, not as a currency; legislation being finalized

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The government is unlikely to close the door on cryptocurrencies and instead take a nuanced approach. They may not be permitted as a currency to settle transactions and make payments, but could be held as an asset like stocks, gold, or bonds.

Active solicitation by businesses, including exchanges and platforms, would be prohibited, people with knowledge of the matter told ET.

The government is finalizing legislation that will pave the way for the regulation of trading in crypto assets while banning the use of virtual currencies for payments and transactions.

“Active solicitation would not be allowed … Details of the bill are being finalized,” a government source said.

The pending legislation could be submitted to Cabinet for review within the next two to three weeks, the person said.

The Securities and Exchange Board of India (Sebi) could be appointed as regulator, although a final call has yet to be taken. “Regulatory discussions are ongoing,” the person said.

Working on tax aspects The government is also working on tax aspects and upcoming legislation should address this, the person added.

The government plans to present the bill in the next winter session of Parliament. ET had signaled on November 8 that the government was likely to take the middle lane on cryptocurrencies and not go for an outright ban.

A person familiar with the discussions at a meeting chaired by Prime Minister Narendra Modi on cryptocurrency on Saturday said the overall vision in government is that measures taken should be proactive, “incremental and forward looking. future “because it is an evolving technology.

The parliamentary standing finance committee that met with representatives of the crypto industry on Monday also appeared to favor regulation and not a complete ban, the position taken by industry representatives.

The Reserve Bank of India (RBI) has expressed concerns about cryptocurrencies posing a threat to macroeconomic and financial stability as well as capital controls. It is understood in favor of a ban in view of this.

RBI Governor Shaktikanta Das reiterated on Tuesday that the number of cryptocurrency accounts in India appears to be exaggerated. At an event hosted by the State Bank of India on Tuesday in Mumbai, he said there was a need to deepen the discussion on cryptocurrencies and that there had not yet been a well-informed debate on the main concerns, some of which had been raised by the RBI.

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