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Friday, January 20, 2023

Nothing Outlaws Crypto as Long as You Follow Legal Process, MoS IT Rajeev Chandrasekhar Says

Minister of State for Electronics and Information Technology Rajeev Chandrasekhar on Thursday said there was no issue with cryptocurrencies in India if all laws are followed, in remarks that contradicted the Reserve Bank of India's view advising investors to stay away from crypto.

India has been trying to come up with regulation for cryptocurrencies, with a central bank deputy governor even calling for them to be banned, but the government has not been able to formulate legislation yet.

In the last budget, the government established a taxation framework for cryptocurrencies, while Prime Minister Narendra Modi said at the World Economic Forum last year that a collective global effort was needed to deal with the problems posed by digital currencies.

Junior IT minister Rajeev Chandrasekhar, speaking at an event in the southern city of Bengaluru, said: "There is nothing today that outlaws crypto as long as you follow the legal process."

In February 2022, a deputy governor of the Reserve Bank of India (RBI), T. Rabi Sankar, said cryptocurrencies were akin to Ponzi schemes or worse and banning them was the most sensible option for India.

RBI Governor Shaktikanta Das also said in February that cryptocurrencies lacked the underlying value of even a tulip.

Last month, Das urged for prohibition of cryptocurrencies, calling crypto trading “a 100 per cent speculative activity.” The RBI Governor warned that the next financial crisis could be triggered by private cryptocurrencies, if such speculative instruments were allowed to grow. "Cryptocurrencies… have huge inherent risks from macroeconomic and financial stability (perspective) and we have been pointing it out," Das said.

Illicit use of cryptocurrencies reportedly hit a record $20.1 billion (nearly Rs. 1,63,217 crore) last year. According to blockchain analytics firm Chainalysis, transactions associated with sanctioned entities increased more than 100,000-fold in 2022 and made up 44 percent of last year's illicit activity.


Will crypto tax hurt the industry in India? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.


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