The Indian government will reportedly implement a regulatory framework for operating with cryptocurrencies by February next year. Instead of a complete ban, this time, the authorities will debate whether to accept bitcoin and the altcoins as an asset class.

India’s U-Turn

The world’s second most populated nation is one of the fastest-growing markets for cryptocurrencies. However, the Indian government (with its controversial approach towards the matter) causes confusion on how locals can operate with digital assets.

Earlier in the year, the authorities की योजना बनाई to impose a total ban similar to the one in China and even criminalize the ownership and mining of cryptocurrencies.

The government started softening its stance ин the next few months, and the upcoming regulations might not be so harsh. According to a recent रिपोर्ट, the legal framework on bitcoin and the altcoins will see the light of day by February 2022 to clarify the taxation of transactions and gains. Surprisingly, the authorities will even discuss the option of accepting cryptocurrencies as an asset class.

A spokesman at the Finance Ministry explained that enforcing certain laws on the industry is vital because the popularity of the digital assets in India attracts bad actors who could employ them in dubious activities. New rules could enable the authorities to stay on top of such operations:

“What should not happen tomorrow is that if I start a personal digital currency, and after good marketing everybody buys it and once it has appreciated, I run away since I am a private player! Everybody has actually bought that currency by using other assets. The government needs to look at regulation in order to avoid the above.”

Listening to The Experts

If India decides to treat crypto as an asset class, the move could boost the country’s economy. At least, that is what the Indian billionaire Nandan Nilekani कहा कुछ महीने पहले।

The entrepreneur agreed with many critics that digital assets are not suitable to be used as a payment method as their fiat currency value is quite volatile and some of them consume too much energy. He instead opined that investors should consider them as a gold substitute, for example:

"जैसे आपकी कुछ संपत्ति सोने या अचल संपत्ति में है, वैसे ही आप अपनी कुछ संपत्ति क्रिप्टो में रख सकते हैं। मुझे लगता है कि क्रिप्टो के लिए एक संग्रहीत मूल्य के रूप में एक भूमिका है, लेकिन निश्चित रूप से लेनदेन के अर्थ में नहीं।"

The interest in cryptocurrencies has indeed skyrocketed in India lately as locals वृद्धि हुई their digital assets investments from $200 million last year to $40 billion this year.