Indian Government to Take ‘Progressive’ Steps on Crypto, Sources Say After PM Modi’s Meeting

The Parliamentary Standing Committee on Finance will meet industry representatives next week to seek their views.

Nov 13, 2021 at 6:30 p.m. UTC
Updated Nov 15, 2021 at 3:00 a.m. UTC

While the Indian government is cognizant of risks associated with cryptocurrencies, it intends to take “progressive” and “forward-looking” steps on the matter, sources told Indian news agency Asia News International (ANI) after Prime Minister Narendra Modi chaired a meeting on cryptocurrencies’ future in the country.

“It was strongly felt that attempts to mislead the youth through over promising & non-transparent advertising be stopped,” ANI tweeted. “There was consensus also that the steps taken in the field of cryptocurrency & related issues by the Govt will be progressive & forward-looking.”

Sources said the participating members noted the risk of unregulated markets becoming a channel for money laundering and terror financing and vowed vigilance. “The government is cognizant of the fact that this is an evolving technology; hence the government will keep a close watch and take proactive steps,” sources told ANI.

India may seek to align itself with other countries/entities to regulate crypto, the sources told ANI, which said, “Since the issue cuts across individual countries’ borders, it was felt that it will also require global partnerships and collective strategies.”

The meeting happened at a time when India’s main opposition party, the Indian National Congress, stepped up its attack on the ruling Bhartiya Janta Party, claiming it had helped cover up a bitcoin scam in the state of Karnataka.

The Indian government has been sitting on a crypto regulation bill for at least a year. Officials have softened their stance on cryptocurrencies in recent months and have invited crypto representatives to discuss the opportunities and challenges of the industry in a meeting scheduled for Nov. 15.

That softening of opinion is not universal, however. Earlier this week the Reserve Bank of India (RBI) governor Shaktikanta Das reiterated his anti-crypto stance, stating that cryptocurrencies pose serious threats to the macroeconomic and financial stability of the country. RBI’s banking ban on crypto entities dated April 2018 was set aside by the Supreme Court in March 2020.

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Omkar Godbole is the senior reporter on CoinDesk's Markets team.