KYC for crypto assets makes sense and welcome

[ad_1]

India’s evolving regulatory framework for crypto assets saw a significant development this week when the Indian government brought intermediaries who process it under the umbrella of money laundering legislation. They must now follow the relevant KYC standards and also report suspicious transactions. To put this development into context, let’s go back to the 2021 winter session of Parliament. Earlier, the Indian government had indicated that a bill to regulate crypto assets would be tabled. However, a bill was never introduced.

Since then, the GoI has gradually come to accept it as one of the financial assets on offer. He also acknowledged the limitation of having stand-alone national regulation for virtual assets. For example, in February, the Indian government informed Parliament that since crypto assets are not confined by national borders, regulation will only be effective if there is international collaboration to evolve a common regulatory framework. Therefore, India is using the G20 platform to catalyze a common framework. Separately, RBI had required the financial intermediaries it regulates to follow KYC standards and other relevant standards for remittances following transactions in crypto assets.

The DEs investigated the transactions they deemed suspicious. As of January 31, the agency had arrested five people and attached assets valued at Rs 936 crore in connection with these transactions. In this context, the latest notification from the Indian government is a corollary of recent developments. Crypto-assets should be treated as financial assets with intermediaries required to meet reporting standards.

FacebookTwitterLinkedinEmail

This article appeared as an editorial opinion in the print edition of the Times of India.

END OF ARTICLE

[ad_2]