NEW DELHI: The government seems to be in no hurry to decide the future for cryptocurrency assets. A senior official said on Sunday that India will hold extensive consultations with other countries before arriving at a decision.
While a joint document was prepared by the International Monetary Fund and the Financial Stability Board had suggested that a ban would not work, but had proposed a detailed roadmap for regulating cryptocurrency.
But regulation could also mean that crypto issuers and exchanges will have to rework the model in which they operate. For example, the official said a structure like stock markets may need to be adopted to split and align the operations of a crypto exchange. with how a stock market interacts with a clearinghouse, custodians and other intermediaries, addressing the risks posed by the collapse of some crypto exchanges.
The official explained that the joint document set out the minimum regulations that countries must adopt and pointed to the suggestion that emerging markets, which face greater risks, may need to go above the baseline level.
The officer also said that a ban by one country would only lead to the market moving elsewhere. Moreover, it would be difficult to monitor every device to enforce the ban.
But with Know Your Customer (KYC) and other norms coming into effect, some concerns around anonymity would be addressed, the official explained.
“Now that the G20 leaders have endorsed it (FSB recommendations), ministers and governments will discuss it and take it forward. We expect there will be a lot of discussion on how to implement it sooner, faster and more comprehensively,” the official said.
“We have a good framework to determine our path forward. The foundation is ready, but how much further we want to go is for us to decide and make a call in the coming months,” the official added.
India has pushed for global regulation of cryptocurrencies to tackle tax evasion and fund diversion.
The Reserve Bank of India (RBI) has called for a complete ban on cryptocurrencies, such as Bitcoin and Ether, saying they are akin to gambling.
“If you want to ban it (cryptocurrency), go ahead and ban it. But if the rest of the countries don’t ban it, it will be extremely difficult for one country to ban it. We need to start that discussion and try to build a consensus on regulations. Then we will gradually decide on our own system,” the official said.
While a joint document was prepared by the International Monetary Fund and the Financial Stability Board had suggested that a ban would not work, but had proposed a detailed roadmap for regulating cryptocurrency.
But regulation could also mean that crypto issuers and exchanges will have to rework the model in which they operate. For example, the official said a structure like stock markets may need to be adopted to split and align the operations of a crypto exchange. with how a stock market interacts with a clearinghouse, custodians and other intermediaries, addressing the risks posed by the collapse of some crypto exchanges.
The official explained that the joint document set out the minimum regulations that countries must adopt and pointed to the suggestion that emerging markets, which face greater risks, may need to go above the baseline level.
The officer also said that a ban by one country would only lead to the market moving elsewhere. Moreover, it would be difficult to monitor every device to enforce the ban.
But with Know Your Customer (KYC) and other norms coming into effect, some concerns around anonymity would be addressed, the official explained.
“Now that the G20 leaders have endorsed it (FSB recommendations), ministers and governments will discuss it and take it forward. We expect there will be a lot of discussion on how to implement it sooner, faster and more comprehensively,” the official said.
“We have a good framework to determine our path forward. The foundation is ready, but how much further we want to go is for us to decide and make a call in the coming months,” the official added.
India has pushed for global regulation of cryptocurrencies to tackle tax evasion and fund diversion.
The Reserve Bank of India (RBI) has called for a complete ban on cryptocurrencies, such as Bitcoin and Ether, saying they are akin to gambling.
“If you want to ban it (cryptocurrency), go ahead and ban it. But if the rest of the countries don’t ban it, it will be extremely difficult for one country to ban it. We need to start that discussion and try to build a consensus on regulations. Then we will gradually decide on our own system,” the official said.
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