The Indian government has reportedly proposed banning the use
of cryptocurrency for payments and setting a deadline for investors to
declare their crypto holdings. Violators may be arrested without a
warrant and held without bail. In addition, the crypto bill may call for
a uniform know-your-customer (KYC) process for all crypto exchanges.
Proposed Rules in Indian Crypto Bill
As a cryptocurrency bill awaits to be taken up in parliament in India, several reports have emerged about what’s in the bill, which the government has not made public.
While crypto assets
will reportedly be regulated, the Indian government is planning to ban
the use of cryptocurrency for payments, Reuters reported Tuesday, citing
an unnamed source and a summary of the bill it has seen.
The proposed legislation also states that the rules will be
“cognizable.” Violators may be arrested without a warrant and held
without bail, the news outlet detailed, quoting the summary of the bill:
The Indian government is planning a ‘general prohibition
on all activities by any individual on mining, generating, holding,
selling, (or) dealing’ in digital currencies as a ‘medium of exchange,
store of value and a unit of account.’
While cryptocurrency will not be legal tender in India, like it is in El Salvador, the proposed crypto legislation will give it legal status.
According to the source, self-custodial wallets will likely be
banned. However, this may prove to be difficult as explained by the CEO
of a major Indian cryptocurrency exchange. He recently described what he expects regarding self-custodial wallets and the new crypto legislation.
The Indian government is also planning to set a deadline to allow
investors to declare their cryptocurrencies and comply with the new
rules, Bloomberg reported Tuesday, citing people familiar with the
matter.
Moreover, The Economic Times reported Wednesday that the proposed
cryptocurrency legislation will require crypto exchanges to share their
know-your-customer (KYC) data with regulators and government agencies,
including the Securities and Exchange Board of India (SEBI), the Reserve
Bank of India (RBI), and the income tax department.
The crypto bill will also call for a uniform KYC process for all
crypto exchanges, the news outlet added, noting that exchange platforms
currently have their own procedures.
Regarding crypto taxation, the government is planning to add
cryptocurrency to Section 26A of the Income Tax Act in the upcoming
budget, the publication conveyed, noting that this will “necessitate
taxpayers to reveal their cryptocurrency investments both in India and
abroad.”
Last week, NDTV reported that it has seen the government’s cabinet note which names SEBI as the regulator overseeing crypto activities in the country. In addition, Indian Finance Minister Nirmala Sitharaman confirmed
last week that the crypto bill has been reworked from its original
version which seeks to ban all cryptocurrencies, including bitcoin and
ether. She also answered several parliamentary questions regarding the proposed cryptocurrency regulation.
source link : https://news.bitcoin.com/india-impose-ban-crypto-payments-deadline-declaring-crypto-assets-kyc-rules/
