Echoing the IMF synthesis paper, India on Sunday all but ruled out a ban on crypto assets and said it would decide on implementing cryptocurrency regulations after extensive discussions with other countries.
The New Delhi Declaration welcomed the synthesis paper prepared by the International Monetary Fund (IMF) and the Financial Stability Board (FSB) that advocates comprehensive regulatory and supervisory oversight of crypto assets. It also advocated for money laundering norms to control the use of crypto assets by criminals and terrorists. It will now be taken up for detailed consideration at the next G20 Finance Ministers and Central Bank Governors (FMCBG) meeting under the Indian Presidency in Maracas, Morocco next month.
“We expect there will be a lot of discussion about how we can implement it faster, more quickly and more comprehensively. “We have a good framework to decide our own course of action,” said a senior Treasury official.
On Saturday, the statement reiterated close monitoring of the risks of rapid developments in the crypto asset ecosystem. “We support the Financial Stability Board’s (FSB) high-level recommendations to regulate, monitor and monitor crypto asset activities and markets, as well as global stablecoin arrangements. We call on the FSB and SSBs (standard-setting bodies) to promote the effective and timely implementation of these recommendations globally in a consistent manner to avoid regulatory arbitrage. “We welcome the joint FSB and SSB work plan for crypto assets,” the statement said.
In July, the FSB published a 9-point list of recommendations for regulating crypto assets. It highlighted the need for robust governance frameworks that define responsibilities and accountability for issuers and service providers. These standards follow the principle of “same activity, same risk, same regulation” and ensure consistent and comprehensive monitoring of crypto asset operations, including stablecoins, in proportion to the risks involved.
India is pushing for global crypto regulation to combat tax evasion and money avoidance. The RBI called for a complete ban on cryptocurrencies such as Bitcoin and Ether as they were comparable to gambling.
The official said it would be difficult for one country to ban cryptocurrencies and that a global consensus would need to be reached that all countries comply with the “absolute minimum” regulations set out in the IMF-FSB paper.
“If you want to ban it (cryptocurrency), go ahead and ban it. But if the rest of the countries don’t ban it, it will be extremely difficult for any country to ban it. Now we have to start this discussion and try to reach a consensus on regulation. Then we gradually decide on our own system. The discussion will now take place in our system. It’s not easy,” the official said.
He also said that there are risks associated with cryptocurrencies because, unlike those in the stock market, there are the same companies that act as custody and clearing systems. “You have to separate them if you need regulation. The purpose of regulation is to ensure that risk is well managed. “Any country that feels it is at higher risk can make its regulation more restrictive,” the official said, adding that there would be no arbitrage if all countries agreed on the same regulation.
https://www.thehindubusinessline.com/todays-paper/tp-economy/india-to-take-a-call-on-crypto-regulations-after-wider-consultation-indicated-no-ban/article67291777.ece India is set to comply with a call for crypto regulations after broader consultations and not announce a ban