According to reports, the Indian government intends to make a decision regarding the legitimacy of cryptocurrencies by the first quarter of 2023 in order to comply with the Financial Action Task Force (FATF). “We’ll have our final responses ready by February or March 2023. By May, we must reply to the FATF”, a government official stated.
A government official was quoted as saying, “The Revenue Department has already sent their views and the Department of Economic Affairs has now been tasked to prepare a detailed response on India’s stance on the legality of cryptocurrency.”
According to report, the official stated:
“One of the questions that we have to respond is on the legality of cryptocurrencies, since we have already started to tax them.
A Financial Stability Board (FSB) report is additionally anticipated in October. It will assist the Indian government in determining whether to prohibit cryptocurrency transactions or to establish a legal framework for managing the crypto trade in India, according to a senior government official quoted in a Monday report of Outlook India.
According to the official:
“We are awaiting the (FSB) report which will be important from the crypto legislation perspective. We are also hoping it addresses how to deal with wallet transfers (of crypto).”
According to the report, depending on what the report suggests, the Indian government will decide whether or not to prohibit wallet transfers. The legislation component is still under development. And the government made it clear that legislation is still a work in progress . This report would go a long way toward addressing the legislative issue.
Since the international watchdog for money laundering and terrorist financing requires countries to have a firm position on the legality of crypto assets in order to be compliant, India is currently not FATF-compliant with regard to crypto assets.
The Financial Stability and Development Council (FSDC) recently held a meeting that was presided over by Indian Finance Minister Nirmala Sitharaman and covered topics related to crypto assets. The council emphasised the pressing need for an unambiguous agreement on whether cryptocurrencies are legal tender.
In a recent meeting with Kristalina Georgieva, managing director of the International Monetary Fund (IMF), the finance minister urged the IMF to take the initiative in regulating crypto assets.
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