- The country’s central bank has previously expressed concern about the asset’s threat to the country’s macroeconomic and financial stability
- Last month, two major exchanges disabled deposits through popular payment systems used in the country.
The uncertainty surrounding the Indian crypto space has left traders and investors with a series of questionable and unanswered questions. Producing the signal, India, the second most populous country in the world, threatens the freedom of exchanges to operate freely.
New Delhi’s imposition of income tax on cryptocurrencies may be a sign of approval
The growing interest of central banks in investor welfare is justified, warning that trading digital assets is the responsibility of investors themselves. Federal taxation of cryptocurrency earnings is recognized as endorsement of digital assets as apex banks advocate an outright ban.
Some tax-imposed advertising regulations seem to reinforce the idea that cryptocurrencies are accepted by the national hierarchy. Late last year, Prime Minister Narendra Modi advocated for the adoption of emerging technologies, including blockchain.
Yet regulatory uncertainty is already being felt by multiple investors already in the country. This comes after CoinSwitch users could no longer deposit cash through his United Payment Interface (UPI), a popular payment system regulated by the country’s central bank. This was also the case for He WazirX, another domestically operated cryptocurrency exchange.
Regulation Brings More Peace to Investors
Speaking at the World Economic Forum in Davos, the CoinSwitch co-founder said the regulation would bring much-needed peace to crypto investors.
“Users don’t know what will happen to their stuff. Will the government ban it, not ban it? How will it be regulated?” He said Reuters.
So far, the Indian cryptocurrency market remains opaque. Not only are we calling for legislation to facilitate identity checks and cryptocurrency transfers, but we are also calling for measures to track suspicious transactions and, if necessary, report them to authorities.