India’s economic affairs secretary says the Indian government will decide on the country’s crypto position “in the coming months.” He explained that the government will consider all the recommendations presented at the G20 summit regarding crypto regulation “very carefully and decide our own policies and thereafter take further action.”
Officials Discuss Indian Crypto Regulation
India’s Economic Affairs Secretary Ajay Seth talked about how the Indian government will proceed with establishing a crypto framework for India in an interview with CNBC-TV18 on Sunday.
India recently hosted the G20 leaders’ summit where crypto regulation was among the key topics of discussion. At the conclusion of the summit, the G20 leaders endorsed high-level recommendations proposed by the Financial Stability Board (FSB) on the regulation of crypto assets and stablecoins. The G20 also welcomed various proposals by the International Monetary Fund (IMF) and other standard-setting bodies.
Seth told the news outlet Sunday that India plans to establish its own cryptocurrency regulations through comprehensive consultations at both the global level and with domestic stakeholders. The government official was quoted as saying:
Based on the consensus which we have been able to achieve or rather build, we will be considering those recommendations very carefully and decide our own policies and thereafter take further action.
The economic affairs secretary was also asked about the proposed ban on crypto by India’s central bank, the Reserve Bank of India (RBI). He replied: “You are asking a leading question … it is not to be seen in that binary.”
He clarified: “It’s a framework for assessing the risk that has been put together, what will be the sound policies. So keeping that framework in mind now we will analyze our own position with reference to what globally the leaders have agreed that they will travel it together.” Seth further shared:
So given those what should be our position will be decided in the coming months.
Seth noted that the G20 has made significant progress regarding global cryptocurrency regulation. He highlighted reports by standard-setting bodies that provide a clear and comprehensive policy framework for assessing the risks posed by crypto assets. They include reports by the International Monetary Fund (IMF), the Financial Stability Board (FSB), the Financial Action Task Force (FATF), and the Bank of International Settlements (BIS). Seth also mentioned that the G20 acknowledges the risks linked to cryptocurrencies, especially concerning emerging economies.
Referring to the declaration of the G20 leaders stating that they have asked their finance ministers and central bank governors to discuss taking forward the Roadmap at their meeting in October, the news outlet quoted unnamed official sources as saying: “Now the G20 leaders have endorsed it [global framework] and now ministers and governments will discuss it and take it forward.” The sources continued:
We expect a lot of discussion to happen on how to implement it faster, swifter, and in a comprehensive manner. We have a good framework to decide our own way forward. The foundation is ready beyond how much we want to go it is for us to decide in the coming months and then take a call.
“If you want to ban it (crypto), go ahead and ban it. But if the rest of the countries are not banning it, it will be extremely difficult for one country to ban it. Now that discussion, we have to take up and try to build a consensus on regulation. Then we gradually decide on our own system. The discussion will happen now in our system. It is not an easy one,” official sources added.
In the IMF-FSB synthesis paper developed at the request of India’s G20 Presidency, the two organizations stated: “Blanket bans that make all crypto-asset activities … illegal can be costly and technically demanding to enforce. They also tend to increase the incentives for circumvention due to the inherent borderless nature of crypto-assets, resulting in potentially heightened financial integrity risks, and can also create inefficiencies.”
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