Understanding India’s Changing Crypto Regulatory Landscape 🇮🇳
Recently, the Securities and Exchange Board of India (SEBI) made a significant submission to the government panel regarding the oversight of cryptocurrencies. This submission suggests a shift in the regulatory approach towards crypto in India, moving away from the total ban previously imposed by the Reserve Bank of India (RBI).
The SEBI’s Proposal on Crypto Regulation
- SEBI proposed that it could monitor the cryptocurrency sector, including activities like initial coin offerings (ICOs).
- The regulatory agency mentioned the possibility of issuing licenses for crypto products related to the equity market.
- SEBI recommended that the Insurance Regulatory and Development Authority of India (IRDAI) and the Pension Fund Regulatory and Development Authority (PFRDA) should oversee insurance and pension-related virtual assets.
- In terms of addressing grievances related to crypto, SEBI suggested implementing the Consumer Protection Act.
- The submission also proposed that the RBI should regulate crypto assets backed by fiat currencies to monitor tax evasion and fiscal stability risks linked to cryptocurrencies.
The Broader Perspective
India is gearing up to regulate the web3 industry and digital assets as these technologies become more mainstream in the country. Despite the 30 percent crypto tax enforcement, the use of decentralized financial platforms has allowed investors to operate beyond the confines of traditional banking systems.
Earlier this month, Vivek Aggarwal, the director of India’s Financial Intelligence Unit (FIU), announced the return of Binance and Kocoin following last year’s ban on their IPs.
Hot Take: What This Means for Crypto Enthusiasts
The evolving regulatory landscape in India presents both challenges and opportunities for crypto investors and enthusiasts. As SEBI takes on a more active role in overseeing the crypto sector, it signifies a shift towards a potentially more structured and regulated environment for digital assets in the country.
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