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India Will Regulate Crypto as Ban Talk Binned – Report

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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Last updated:

June 26, 2023

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While the bitcoin (BTC) bloodbath continues on the markets with reports of newer investors panic-selling, glimmers of cheer have appeared in India, where joyful crypto advocates have been welcoming reports that the government may be set to scrap talk of a ban – and instead take a regulatory route.

The Indian authorities have been talking ominously about a ban for years, mainly through anonymous sources – much to the ennui of the subcontinent’s many crypto investors. A much-maligned bid from the central bank to ban banks from dealing with crypto-related business was derailed by the Supreme Court last year.

But per a report from the Economic Times, the government is mulling the formation of “a fresh panel of experts” who would “study the possibility of regulating cryptocurrency in India.”

However, like many of the ban-related news articles, it appears that anonymous leaks are powering reports, with no official confirmation of crypto policy forthcoming yet. Instead, the media outlet stated that it had been informed of the development by “three sources privy [to] the discussions.”

Regardless, crypto fans will be cheered to learn that these anonymous sources are not Cassandras – at least not this time around. The Economic Times wrote that the “prevailing view” in the government was that “the recommendations by a committee headed by former Finance Secretary Subhash Garg in 2019 for a blanket ban” on crypto “had become outdated.”

An official “in the know of the matter” was quoted as confirming:

“There is a view within the government that the recommendations made by the Subhash Garg are dated and a fresh look is needed at the use of cryptos rather than a total ban.”

Instead, the sources confirmed, the government is now likely to draw up legal definitions of tokens as “assets” – while it would continue to talk to “stakeholders” about “potential supervisory risks.”

The media outlet noted that “discussions are at an early stage and no formal resolution has yet been passed,” and added that the membership of the proposed committee was still up in the air.

The Minister of State for Finance and Corporate Affairs Anurag Thakur has met “members of the crypto and banking industry” in “this regard,” the report’s authors added, noting that Thakur is “among the dozen or so names under consideration” for membership, and that “the opposition party” could also be represented.

The committee could also be charged with “studying ways to operationalize” the central Reserve Bank of India’s proposals for the rollout of a digital rupee, as well as forming blockchain-related policies.

On Twitter, the crypto advocate and Binance–owned WazirX crypto exchange co-founders were in a celebratory mood.

The trading platform’s Chief Operating Officer Siddharth Menon, wrote:

“This is huge. Crypto is finally getting regulated in India.”

Co-founder Nischal Shetty, meanwhile, extended a “heartfelt thank you” to India’s Minister of Finance and Corporate Affairs Nirmala Sitharaman and the Union Minister of State for Finance and Corporate Affairs Anurag Thakur, both of whom have been vocal about their desire to see India pursue pro-blockchain policies and exclude talk of “banning” crypto.

Shetty wrote,