Cryptocurrency

Government of India Proposes to Regulate Digital Currency Industry

Government of India has carved out a plan which it wishes to employ towards regulation of its digital currency industry.

The draft law on the subject, which is currently under the consideration of Indian Parliament, will contain provisions with regard to crypto by comprehensively defining the virtual currencies and their uses and virtual currencies will be divided in accordance with the individual use.

According to a new source, it has been suggested that India has carved out a plan for the purposes of regulating its digital currency industry. Indian Government is of the view that it needs to define virtual currencies under a legislation, which legislation is currently under Indian Parliament’s consideration.

For instance, the Government’s proposal suggests that virtual currencies will be treated as “commodities”. However, they will be categorized in the sense as to which particular virtual currencies can or cannot be regarded as “commodities”. The determination of this difference will be done on the basis of individual usage of each cryptocurrency.

It seems that India has finally accepted that the country as well as its residents want crypto to continue. Otherwise, for the past several months, the situation of Indian crypto industry was quite perturbed. There was an apparent ambiguity in the statements of the Indian Government officials.

Some were suggesting that India is likely to impose second ban upon the use of cryptocurrencies. While others were claiming that there will be no further ban. On the other hand, central bank of India was stressing that the country needs a digital currency of its own. Similarly, the Indian tax collecting authority wanted to impose crypto tax.

In these circumstances, it was unclear what the true intention of the Indian Government was. But throughout this time, Government and its functionaries were on the same page i.e. need to have an official digital currency.

A newspaper of India, “The Economic Times”, reported that a law on the aspect of crypto is under consideration by the Indian Parliament. The newspaper claimed that under the proposed law, the Government of Indian plans to treat virtual currencies under the heading of “commodities”.

However, depending on the usage of individual cryptocurrencies, they will be categorized further. For instance, some cryptocurrencies will fall in the category of “commodities” while others may fall within the category of “securities”.

For each category, the law will deal with accordingly and provide separate and distinct set of regulations. Against each category, there is also going to be “tax” which will be collected by the respective Indian authority.

This suggestion of the Indian Government, according to newspaper, is already made part of the proposed legislation awaiting approval. However, there is a counter-argument from the Indian crypto community.

08They argue that dividing cryptocurrecies isn’t that simple as has been expected by the Indian Government. The best way to determine the difference can be done on the basis of their technologies.

Photo by Srikanth D on Unsplash

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