India’s crypto and Web3 space will have to wait at least 12-18 more months for specific legislative regulations, according to Jayant Sinha, a senior politician and chair of the country’s Standing Committee on Finance.
Sinha made the statement during a CoinDesk interview at India Blockchain Week in Bengaluru. This suggests that a dedicated bill addressing the burgeoning sector is unlikely to materialize before mid-2025.
Sinha said that the bill is still under discussion and that it will take at least another 18 months before it is ready to be tabled.
The lawmaker also revealed some details about the content of the bill, which he said will not ban crypto outright, but will impose strict regulations on its use and trade. He said that the bill will define crypto as an asset, not a currency, and will prohibit its use for payments and remittances. He also said that the bill will create a framework for web3 applications, such as decentralized finance (DeFi) and non-fungible tokens (NFTs), but will require them to comply with Indian laws and regulations.
“Regulators and policymakers are responsible, not just on the innovation side, which of course we want to encourage, but also on the safety side,” Sinha said. “We have to really find that balance and that balance is going to evolve over the next 12 to 18 months.”
“Point number two is global standards are still evolving and 2024 is the year of elections around the world. Many important countries, whether it’s the U.S., the U.K., India, are going in for elections. So, I’m not sure in 2024 the standards will develop. We also have to see what’s going to emerge from the (crypto) meltdown about whether some of these companies are going to survive,” Sinha opined to CoinDesk.
While the Indian government has expressed its intention to establish a regulatory framework for crypto and Web3, it seems to be taking a cautious and gradual approach. Despite the lack of a specific bill, the government has already taken steps like:
- Imposing a 30% tax and 1% TDS on gains from virtual digital assets.
- Pushing the G20 to accept global crypto guidelines.
- Considering a string of policy decisions that would serve as a de facto regulatory framework.
This approach suggests that the government is keen on aligning with global standards and ensuring financial stability before enacting comprehensive legislation.