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Cryptocurrency still remains beyond any regulation in the country; however, government authorities have started promoting transparency regarding crypto transactions
Indian investors look forward to the official verdict on the cryptocurrency exchanges in the country. Even though El Salvador has embraced the digital currency revolution, India is still thinking about it. Last week, Jayant Singh, chairman of the parliamentary standing finance committee, said at an online event that the Indian government was taking a “distinctive approach” to regulating cryptocurrencies in India. The statement came at a time when cryptocurrencies were not yet regulated in the country. India has a strong base of investors and cryptocurrency exchanges. But investors still don’t know the future of cryptocurrencies.
Is Cryptocurrency Illegal In India?
Bitcoins and other cryptocurrencies are currently outside the scope of legal regulation in India. We cannot call them illegal as they are not yet authorized for use by any central authority in the country. The cryptocurrency remains outside the scope of any guidelines, regulations or rules. This makes Bitcoin and Altcoin transactions riskier as disputes that arise from these exchanges are not legally related.
Although India has not yet imposed regulations on cryptocurrency transactions, it has been demanding transparency in all of these companies. Changes to the Companies Act were made in April for this purpose. Because of this transparency, digital assets and profits from them should be taken into account as capital assets that are taxable on capital gains. However, companies are not yet sure how to deal with different types of profits and income in this regard.
It is speculated that the Cryptocurrency Bill will be unveiled in this parliament’s winter session of Parliament and aims to define and classify cryptocurrencies according to the technology involved. An inter-ministerial body on cryptocurrencies recently proposed treating cryptocurrencies as digital assets rather than currency. There are also speculation that government-imposed cryptocurrencies could become the norm.
What If India Bans Cryptocurrency?
The ban on cryptocurrencies in India would mean that you would not be able to exchange the local fiat currency to buy cryptocurrencies or settle HODL-ed cryptocurrencies for cash. Cryptocurrency exchanges will also be suspended. The ban would ensure that the HODL-ed cryptocurrency stays on HODL until the restriction is removed.