According to Indian government official Rajeev Chandrasekhar, there is currently nothing that outlaws cryptocurrency in India as long as legal procedures are followed. This statement contradicts the Reserve Bank of India (RBI), which has stressed that cryptocurrency does not have any underlying value.
Chandrasekhar, who serves as India’s Minister of State for Electronics and Information Technology and Minister of State for Skill Development and Entrepreneurship, as well as a member of Rajya Sabha (the upper house of parliament), made these comments at an event in Bengaluru on Thursday.
The Indian government has not yet established a regulatory framework for cryptocurrency, however, in December 2020, the government informed parliament that crypto legislation can be effective only with significant international collaboration. The Finance Minister of India, Nirmala Sitharaman, recently announced that the government plans to discuss crypto regulations with G20 countries. However, crypto income is already taxed at 30% in India, and a 1% tax deducted at source (TDS) is levied on crypto transactions. The government has also recently revealed that it is launching a crypto awareness campaign.
On the other hand, India’s central bank, the Reserve Bank of India (RBI), has recommended a complete ban on cryptocurrencies such as Bitcoin and Ethereum. RBI Governor Shaktikanta Das has said that “cryptocurrency does not have any underlying value” and warned that it will undermine the authority of the RBI and lead to the dollarization of the economy. He even expects crypto to cause the next financial crisis if it is not banned.
It is clear that there are differing opinions about the regulation and future of cryptocurrency in India. It will be interesting to see how the government navigates this issue and how it ultimately chooses to regulate the use of digital currencies in the country.
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