The Indian government informed Parliament that there is currently no fixed timeline for the development of comprehensive regulatory guidelines for virtual assets, emphasizing the need for international cooperation.
Current Regulatory Status
The government responded to parliamentary queries on steps being taken to set up a structured regulatory framework and the expected timeline for it. It was noted that consultations with industry stakeholders and international bodies are ongoing, but policy efforts on virtual assets require global action to prevent regulatory arbitrage.
International Cooperation on Cryptocurrencies
India seeks to regulate borderless crypto assets effectively through deep international cooperation. The adoption of the 'G20 Roadmap on Crypto Assets' during India's G20 Presidency highlighted the need for collaborative action, urging all jurisdictions, especially emerging economies, to develop risk-sensitive regulations.
Challenges and Issues for India
Despite existing taxation on virtual asset income and transactions being covered under the Prevention of Money Laundering Act since March 2023, countries face challenges in investor protection without international cooperation. India's popularity in crypto makes it vulnerable to fraud, as highlighted by the recent scam in Andhra Pradesh.
These developments highlight the risks in India's rapidly changing crypto sector. Work continues on policies that balance national interests with international standards for effective digital asset regulation.
