India Working To Build Consensus On Crypto Regulation During G20 Presidency

India is working with the Financial Stability Board (FSB) to reach a consensus on regulating cryptocurrencies during the country’s G20 presidency itself, Economic Affairs Secretary Ajay Seth said.

The FSB, established in 2009 after the G20 summit, is an international body that monitors and makes recommendations about the global financial system.

In an interview with news agency PTI, Seth said that the International Monetary Fund’s (IMF’s) paper on cryptocurrencies was discussed among emerging economies on January 15 and 16.

“We had a one-and-a-half day workshop. Thereafter, they are drafting a paper for a seminar, which will be conducted on the sidelines of G20 Finance Ministers and central bank governors meeting in Bengaluru that is scheduled on February 23,” Seth said.

The government aims to reach a consensus on global regulations for cryptocurrencies during the seminar, he added.

Seth said the idea behind working with the FSB is that at least the policy stance towards crypto assets as well as the roadmap for regulations is broadly agreed upon by the G20 members.

India assumed the Presidency of G20 on December 1 and will hold it till the G20 summit to be held in New Delhi in September 2023.

Earlier also Seth had said that G20 countries were trying to reach a policy consensus on crypto assets for global regulations. “The regulation should flow from the policy view taken. In fact, one of the priorities which have been put on the table is to help countries build a consensus for policy approach to the crypto assets,” he said.

G20 is one of the largest economic forums in the world, with its members accounting for more than 80% of the world’s GDP, 75% of the global trade, and 60% of the world’s population.

Finance Minister Nirmala Sitharaman, who has repeatedly called for global regulations for crypto, earlier said that the G20 nations should bring non-financial assets such as crypto and immovable properties under the purview of automatic exchange of information among countries.

The Economic Survey 2022-23, released earlier this week, also called for global regulations for cryptocurrencies. “The geographically pervasive nature of the crypto ecosystem necessitates a common approach to the regulation of these volatile instruments,” it said.

While the Reserve Bank of India is a staunch opponent of private cryptocurrencies, the Indian government has not made its stand clear on the virtual assets. However, the government brought crypto income and transactions under the tax net last year. It introduced a 30% tax on income from virtual digital assets (VDAs), including cryptos and non-fungible tokens (NFTs), in the last Budget, along with a 1% TDS on such transactions.

The collapse of crypto exchange FTX, crash of Luna and Terra, and crypto scams such as GainBitcoin, BitConnect and Morris Coin have also raised concerns among government officials.