India’s Crypto Policy: Discussion Paper Planned for June 2025
Why in the news
The government signalled a careful rethink of crypto regulation, prompted by pro-crypto moves in the United States.
Key facts
- Plan: discussion paper expected in June 2025, open for public comments.
- Scope: several regulatory options for virtual digital assets (VDAs).
- Reference: the IMF-FSB synthesis paper and global practices.
- Current position: no legal status; Budget FY23 brought a 30% tax on gains, expressly without legal validity.
- Compliance: crypto exchanges must register with the Financial Intelligence Unit (FIU).
RBI stance
- Raises concern about misuse for money laundering and terror financing.
- Promotes its Central Bank Digital Currency (CBDC) as a regulated alternative.
Government approach
- Consultative and gradual, involving all stakeholders.
- A senior official said no knee-jerk decision would be taken given the industry’s wide ramifications.
- Bharti Group Chairman Sunil Mittal urged India to keep pace with global changes.
Global context
- The US moved from restriction under President Biden to pro-crypto legislation under President Donald Trump.
- The US created a strategic bitcoin reserve and pardoned Ross Ulbricht, founder of Silk Road.
- Vice President JD Vance urged the industry to keep up pressure on Congress.
- Pakistan announced its first state-backed bitcoin reserve.
Exam angle
- Tax rate on crypto gains: 30%.
- Registration authority for exchanges: FIU.
- RBI alternative: CBDC.