India is reconsidering its stance on cryptocurrencies in response to the changing attitudes towards these virtual assets in other countries, according to a senior government official speaking to Reuters on Sunday.
This reevaluation, influenced by the crypto-friendly policies adopted by the U.S., may lead to a delay in publishing a discussion paper on cryptocurrencies originally scheduled for release in September 2024.
Economic Affairs Secretary Ajay Seth stated in an interview, More than one or two jurisdictions have changed their stance towards cryptocurrency in terms of the usage, their acceptance, where do they see the importance of crypto assets. In that stride, we are having a look at the discussion paper once again.
Seth pointed out that due to the nature of such assets transcending borders, India's position cannot be one-sided.
Although he did not mention the United States directly, Seth’s comments allude to the formation of a cryptocurrency working group under Trump, aimed at proposing new regulations and exploring the establishment of a national cryptocurrency reserve.
Despite India’s strict regulatory environment and high trading taxes, interest in cryptocurrencies has been growing among Indians.
In December 2023, India's Financial Intelligence Unit (FIU) issued show-cause notices to nine offshore cryptocurrency exchanges for failing to comply with local regulations. Additionally, Binance, the world's largest crypto exchange, was fined 188.2 million rupees ($2.25 million) in June 2024 after registering with the FIU in an attempt to resume operations in the country.
Last year, India hinted at a shift in policy by suggesting that several regulatory bodies oversee cryptocurrency trading, indicating a level of openness towards the use of private virtual assets. This is in contrast to the stance of the country's central bank, which has expressed concerns regarding the macroeconomic risks posed by private digital currencies.