India is having “detailed discussions” with other G20 members about forming a collective standard operating procedure (SOP) to regulate crypto assets, Indian Finance Minister Nirmala Sitharaman has revealed. She also called for “a globally coordinated approach on the regulation of crypto assets” during her recent meeting with International Monetary Fund (IMF) Managing Director Kristalina Georgieva.
G20’s Crypto Regulatory Discussion Underway
Indian Finance Minister Nirmala Sitharaman answered some questions regarding crypto mining and regulation on Monday in Lok Sabha, the lower house of India’s parliament.
Noting that cryptocurrencies are largely unregulated in India at the moment, Sitharaman explained: “Whether it’s mining or whether it’s the asset or whether it’s the transaction, we recognize that it is very, completely almost, driven by technology, and a standalone country’s effort in controlling or regulating it is not going to be effective.” She added:
There is an evolving consensus and that’s why in the G20, we are raising this issue and having detailed discussions with the members so that a standard operating protocol [SOP] emerges after the discussions.
The Group of Twenty (G20) comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the U.K., the U.S., and the European Union. The G20 members represent around 85% of the global GDP, over 75% of the global trade, and about two-thirds of the world population.
The Indian finance minister further told parliament that the aim of the discussions with other G20 members is to have “a coherent, comprehensive approach where all countries work together in bringing some regulation — whether it’s mining, whether it’s transacting — and therefore all this is being looked at comprehensively.” She emphasized:
We are working together to get a collective SOP on it.
Sitharaman similarly told reporters on Saturday that the issue of regulating crypto assets will be taken up at G20 meetings under India’s presidency.
“Crypto is heavily tech led and less of human intervention,” the Indian finance minister was quoted by PTI as saying. “We are talking to all nations that if regulation has to be framed then one country cannot frame it alone. So we are speaking to all for forming a standard operating procedure so that it is effective … All these are part of [the] discussion. The process of discussion is on in G20.”
Sitharaman’s statements followed her virtual meeting with International Monetary Fund (IMF) Managing Director Kristalina Georgieva on Thursday where she discussed the role of the IMF and other relevant international organizations “to develop a globally coordinated approach on the regulation of crypto assets,” the Indian finance ministry described on Twitter. India’s Economic Affairs Secretary Ajay Seth said earlier this month that the Indian government plans to introduce measures around crypto this year.
At the G20 Finance Ministers and Central Bank Governors meeting last October, the Indian finance minister “called for an effective tax reporting regime and information exchange between jurisdictions for crypto assets to combat offshore tax evasion,” India’s Ministry of Finance described at the time.
While India does not have a regulatory framework for crypto, the government is taxing crypto income at 30% and has imposed a 1% tax deducted at source (TDS) on crypto transactions.
Earlier this month, Sitharaman presented this year’s Economic Survey to parliament highlighting the need for “a common approach to regulating the crypto ecosystem.” This year’s Finance Bill also introduced new crypto tax penalties, including jail time for nonpayment of crypto TDS.
Meanwhile, India’s central bank, the Reserve Bank of India (RBI), has continued to recommend a complete been on crypto assets, including bitcoin and ether. RBI Governor Shaktikanta Das has warned that cryptocurrencies are a risk to the country’s financial system and will cause the next financial crisis if they are not banned.
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A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.
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