India to consider Cryptocurrency as a ‘Digital Asset’
SEBI might oversee the introduction of a regulatory regime for digital currencies, that would enable the Government to levy GST on cryptocurrency trading.. read on to find out more.
In an article by the Indian newspaper – The Hindu, a senior Indian Govt. official was quoted saying “The discussion on whether cryptocurrencies should be banned or regulated has been on for some time. The pros and cons for both aspects were put forth in the meeting chaired by Finance Minister Arun Jaitley last month (June)”
Currently, the cryptocurrencies are in a grey area, with the Indian Law not having them declared as legal or illegal. However, recent sources have said that the Government might be open to treating cryptocurrency like Bitcoin, Ethereum and Ripple et cetera like digital gold. A formal tax base can be promoted on registered exchanges and a illegal activities such as money laundering, terror funding and drug trafficking might also gain monitoring.
According to the official, “One bitcoin is worth as much as 60 grams of gold. The market cap for all cryptocurrencies has crossed $100 Billion USD, with most of the increase coming in the past few months. On April 1, 2017, the total market cap was just over $25 Billion, representing a 300% rise in just over 60 days.”
In such a scenario, another Govt. official believes that “Banning will give a message that all related activities are illegal and will disincentivise those interested in taking speculative risks.”
As The Hindu reported, though the topic of banning cryptocurrencies was indeed broached during the meeting, the proposal received notably less support from top officials from Ministry Of Finance, Home Affairs and IT, SEBI, Reserve Bank Of India, State Bank of India and NITI Aayog.
The indication of the support of such top Government Officials for the regulation of cryptocurrency in India would signal the definite boost of the blockchain technology in India and lead towards a more supervised ecosystem.
It is a possibility, that this new regulatory regime might be overseen by the stock regulator, Securities and Exchange Board of India (SEBI) with a tab on the trading being kept along with levying the Goods and Services Tax (GST) on cryptocurrency sale and purchases.
The Government however, is wary that regulation might provide legitimacy to “what is currently ambiguous,” and may lead to a further rise in its valuation, and subsequently contributing to the “Investment Bubble,” the article said.
Cryptocurrency enthusiasts all over the nation are eagerly waiting for the day when cryptocurrencies may viewed as digital assets under the Indian Law.
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