Recently, the Indian government gave some answers concerning cryptocurrency in the Lok Sabha, the lower house of India’s Parliament, on Monday. The query sought to investigate if the government is considering legalizing cryptocurrency and the potential effect it may have on Indian citizens, particularly the youth.
Shri Pankaj Chaudhary, the Minister of Finance, reiterated his prior statement to Parliament that crypto assets are currently unregulated in India. He further noted that due to their borderless nature, international collaboration is necessary to prevent regulatory arbitrage.
Currently, the Indian government is taking a cautious stance on the regulation of cryptocurrency and is currently in the process of drafting a bill. Crypto income is subject to a 30% tax rate and 1% TDS (Tax Deducted at Source) is applied to crypto transactions. Furthermore, crypto transactions have been included under the Prevention of Money Laundering Act, 2002 (PMLA).
Steps for Preventing Crypto Frauds
In the Lok Sabha, the finance minister was asked about the rise in crypto-related frauds over the past few years, and the steps taken by the government to prevent such frauds.
The Finance Minister responded, highlighting the government’s efforts to protect consumers and strengthen the regulatory framework for crypto exchanges, which includes ensuring strict compliance with international financial regulations.
Minister Chaudhary noted that crypto assets in India remain unregulated, with existing laws against fraud and cybercrime applicable to any fraud related to them. He further highlighted the online portal established by India’s Ministry of Home Affairs for reporting crypto-related frauds to the Cyber & Information Security Division and emphasized that the Union Territories (UTs) must take responsibility for investigating and prosecuting any associated criminal activity.