India appears to be taking a progressive stance on Bitcoin. Especially in light of the fact that this country is trying to agree on the classification and legality of this new asset class.
Further advances in cryptocurrency
Amid a barrage of cabinet meetings, industry interviews and banking-related questions, the Indian Prime Minister talks about cryptocurrencies. At the Dialogue Sydney conference, Prime Minister Narendra Modi called on democratic nations to work together to make the most of crypto and blockchain. He also stated that they should not be used for unethical purposes.
On Monday, Prime Minister Modi spoke at a high-level meeting on cryptocurrencies in the context of money laundering and terrorist financing. The atmosphere around the meeting showed that strong management measures were being taken, albeit forward-looking and progressive.
The Indian government has previously taken steps to build a robust regulatory infrastructure for this fast growing sector. Many high-level discussions took place, including one between the Central Bank (RBI), the Treasury Department and the Home Office, as well as cryptocurrency experts and key industry participants inside and outside India.
Despite the objective views of several government ministers, RBI Governor Shaktikanta Das was not convinced. On Tuesday, the executive reiterated its stance that exchanging cryptocurrencies could be dangerous for any financial system as they are not overseen by central banks.
Despite the rising popularity of cryptocurrencies in India, lawmakers remain divided over the need for a comprehensive regulatory system. Bitcoin law is expected to be presented to Indian lawmakers in the next session. Many hope that this will bring peace and clarity to investors and institutions.
India plans to cut goods and services tax (GST) on crypto exchanges from 18% to 1% through a regulatory reclassification.
India’s CBDC starts next year
Reserve Bank is preparing to launch its first central bank digital currency in the first quarter of next year, said P. Vasudevan, director general of the RBI Department of Settlements & Settlements.
The President of the Peruvian Central Bank recently announced that his country will join forces with India and two other countries to create its own CBDC, although crypto regulation in India remains in the dark.
A CBDC is a digital asset pegged to a country’s official currency, or essentially a digital version of fiat money. In the case of India, the country’s CBDC is referred to as the Digital Rupee and is pegged to the National Rupee.
Previously, the central bank had planned to launch its first CBDC in December, but due to an official schedule or roadmap, the launch has been postponed.
Vasudevan said the RBI is considering various questions related to the segments a CBDC should address, wholesale or retail, validation mechanisms and other issues, including distribution channels.
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