G20: India To Lead Formulation Of Global Framework For Regulating Crypto, Says FM Sitharaman

Finance Minister Nirmala Sitharaman on Saturday (September 9) said that India’s presidency of the G20, backed by the International Monetary Fund (IMF) and the Financial Stability Board (FSB), will establish a global framework to regulate crypto assets. 

“The presidency will support the IMF and the FSB in setting up the contours of the regulatory framework for a globally coordinated approach to crypto assets,” said Sitharaman while addressing a G20 press briefing in New Delhi.

While noting that the global push for transparent policies on crypto assets has gained momentum under the Indian presidency, Sitharaman added that consensus was emerging among G20 countries for comprehensive policies on cryptocurrencies. 

Sitharaman also welcomed the recently unveiled crypto synthesis paper formulated jointly by the IMF and the FSB. She said the synthesis paper delves deeper into how the policy and regulatory frameworks developed by the two bodies in cooperation with other industry organisations will fit together and interact with each other.

This comes days after Prime Minister Narendra Modi, while addressing the B20 Summit India 2023, called for a global framework for regulating cryptocurrencies.

The remarks from Sitharaman are more or less in line with previous statements echoed by her and senior functionaries of the government, including the Reserve Bank of India (RBI), on crypto. While the central bank has called for a blanket ban on private cryptocurrencies, the government has so far stayed away from it.

However, the union government has promulgated a series of crypto rules that dissuade users from investing in the emerging unregulated space. This includes a 30% tax on gains earned on crypto assets and a separate tax deducted at source (TDS) on crypto transactions above INR 10,000.

Discussions on cryptocurrencies also took centre stage at the G20 summit as countries from across the globe gathered in New Delhi to discuss the issue. Apart from this, the recent meeting of Finance Ministers and Central Bank Governors of G20 nations also deliberated on a policy consensus for regulating cryptos with India actively pitching for such rules. 

A day earlier, the IMF and the FSB also called for actively regulating crypto space against an outright ban. In the synthesis paper, the bodies called for the need to safeguard monetary sovereignty and stability and argued against giving cryptos the status of legal tender. 

The 45-page long document also called on the G20 governments to devise coordinated international standards to protect economies from potential risks and sought active implementation of FATF norms to curb money laundering and terror financing through crypto currencies.