India’s Prime minister Narendra Modi presided over a high-level meeting, discussing ways to manage the burgeoning cryptocurrency sector. The meeting, as per the government sources, was the result of detailed consultation held with the Reserve Bank of India, the Finance Ministry, as well as domestic and international experts. Sources revealed that an agreement was reached to adopt progressive and forward-looking measures, while at the same time concerns were raised against the ‘unregulated sector’ from being used as a weapon for ‘money laundering and terror activities’.
Alarms were particularly raised with regards to a recent advertisement by the country’s leading crypto community who claimed that crypto investments have reached a staggering 600K crore. Sources said that the leadership viewed such marketing, both online and offline, as attempts to entrap individuals into speculating in this market.
On the crypto investment issue, sources divulged that the Reserve Bank of India is maintaining a close watch on such resources being transferred from banks to digital exchanges and is currently collecting data from the financial institutions, periodically. It is noteworthy to mention that the country’s top regulator has repeatedly expressed concerns with regards to its acceptance as a legal tender and even banned crypto transactions, a few years ago.
Later Supreme court struck down the ban in 2020 deeming cryptocurrency as not illegal but only an unregulated commodity. Despite that, the RBI maintained its stance and continued to express uneasiness over the digital asset industry. In a recent event, RBI governor Shaktikanta Das said,
“On crypto…we have serious concerns from the point of view of macroeconomic and financial stability. How the issue has to be dealt with — we have given our detailed suggestions to the government; as far as I know the matter is under the active consideration of the government and the government will decide.”
Latest developments in India’s crypto roadmap
The parliamentary committee on Finance has scheduled a meeting on Monday next week inviting cryptocurrency stakeholders and industry experts to discuss the emerging opportunities and challenges in the sector. In brief, the recent developments are a clear indication that India is on the cusp of drafting a legal framework and providing much-needed clarity for the country’s crypto community.