India To Define Crypto As Asset, Ban Payments, and Ads - Report

India To Define Crypto As Asset, Ban Payments, and Ads - Report

Amid a rising number of signs indicating that India’s government could adopt a more nuanced approach to cryptoassets, another report claims that the authorities are finalizing work on legislation that could pave the way for regulation of cryptoasset trading - while banning crypto’s use in payments and transactions.

Under the legislative proposal, the government will allow citizens to hold cryptoassets as assets, The Economic Times reported, citing undisclosed sources allegedly close to prime minister Narendra Modi’s cabinet. 

In addition to this, businesses such as crypto exchanges and platforms would also be banned from actively recruiting new customers through advertising, per the report. 

It added that the draft legislation could be submitted to the cabinet for consideration in the next two to three weeks.

With these plans in mind, major Indian crypto exchanges such as WazirX and Bitbns have reportedly decided to abstain from advertising their services even before any binding legislation enters into force.

A person aware of the discussions held during a meeting chaired by Modi last Saturday reportedly said the overall view within the cabinet is that the steps to be taken should be “progressive and forward-looking” with regards to the blockchain technology.

The government’s restrictive stance on crypto was previously associated with the conservative policies adopted by the Reserve Bank of India (RBI), the country’s central bank.

Meanwhile, the Indian parliament is also progressing with its work on regulating cryptoassets. On November 15, the parliamentary standing committee on finance met with representatives of major exchanges, the Blockchain and Crypto Assets Council (BACC), and other industry insiders for the first time ever. Local observers expect Indian lawmakers will deliberate on the much-awaited crypto legislation during the legislature’s winter session which is scheduled to begin on November 29.