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India finalises law to allow crypto as asset, not payment method

The Indian Parliament is considering the Cryptocurrency and Regulation of Official Digital Currency Bill that would allow regulated digital asset trading but put a stop to crypto payment and transactions. This means that Indian crypto users would only be able to use their assets like gold, market shares or bonds. 

Over the last few days, the parliament held a series of closed-door meetings with crypto industry representatives and the Reserve Bank of India (RBI) about the bill that would regulate crypto activities in the country. These meetings were chaired by the country’s Prime Minister, Narendra Modi. 

An undisclosed source from the Economic Times said that the details of this upcoming bill are in the process of being finalised with the overall view on crypto leaning on the proactive side. The bill is said to be introduced in the upcoming session of the Indian Parliament. 

‘The trickiest part is defining the asset class,’ Chief executive officer and founder of Policy 4.0 Tanvi Ratna commented on it. She believes that regulating crypto assets doesn’t solve the issues that Indian authorities are concerned about. 

However, Ratna added that it does take the currency out of the equation which is the major concern by the RBI.

Amidst the backdoor talks, the crypto firms and exchanges may possibly be classified depending on their services. These categories include facilitators, brokerages and trading platforms. 

Local exchanges in India are pushing authorities to place a regulatory sandbox that will fine-tune the regulations. According to Economic Time’s undisclosed source, the government may assign the Securities and Exchange Board of India (SEBI) but no final call has been made. 

Aside from this, active solicitation by crypto exchanges and platforms would be prohibited on the proposed bill. 

The talks were brought about by recent issues regarding crypto activities in India, specifically on crypto advertising. A huge debate on how crypto ads can mislead the youth ensued as confirmed by Ratna in an exchange with Coindesk representatives.

Last July, the High Court of Delhi called for a standardised disclaimer on crypto ads aired on live television. Lawyers Ayush Shukla and Vikash Kumar petitioned for SEBI to mandate a disclaimer that covers 80% of the screen with a five-second voiceover reiterating the text. 

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