The second-most populated nation will reportedly implement a regulatory framework on cryptocurrencies only after a global consensus on the matter. According to a person familiar with the matter, the Indian government does not plan a law soon to either restrict or promote dealing with digital assets.
Crypto Regulation Needs Global Approach
India is among the countries with the most controversial stance on the cryptocurrency industry. Over the past few years, the authorities have announced intentions to ban and criminalize the usage of the asset class. Later, they abandoned these plans, insisting that regulation would be a better step than a blanket ban.
However, it remains unknown how and when India will impose a regulatory framework on the sector.
According to recent coverage by Bloomberg, the government will take a stance only after reaching a consensus with other countries. An individual familiar with the matter further revealed that India has no intentions to either tighten or encourage crypto trading anytime soon.
The idea of a global stand on digital assets has already been proposed in the past several months. Earlier this year, the Prime Minister of the country – Narendra Modi – opined that India should not act alone when formulating rules in the industry. Seeking international assistance in composing a common strategy on the matter sounds like the right solution for the top politician.
Despite the uncertainty, India has implemented an important taxation rule in the sector. As of April 1, investors will be slammed with a 30% tax on income from digital asset trading.
The Confusion Causes a Crypto ‘Brain Drain’
A few weeks ago, Sandeep Nailwal – CEO and Co-Founder of Polygon – opined that the lack of rules generates massive chaos in the Indian digital asset space. In his view, this disorder causes thousands of developers, investors, and entrepreneurs to leave for nations with better-regulated ecosystems.
Nailwal said he wants to live in his homeland and keep developing his blockchain protocol in that part of the world. However, the situation there is unfavorable for such progress:
“Overall, the way the regulatory uncertainty is there and how big Polygon has become, it doesn’t make sense for us or for any team to expose their protocols to local risks.”