With a little more than seven months remaining in India’s G20 presidency, the country’s finance minister is renewing the call for a unified policy to help blunt the risks involved with cryptocurrency investments.
In remarks this week at the Peterson Institute for International Economics in Washington, D.C., Nirmala Sitharaman noted that the crypto collapses affecting investors worldwide mitigate against the effectiveness of reforms on a country-by-country basis.
“Cryptocurrencies are a very important part of the discussion under the G20 India presidency, given so many collapses and shocks in cryptocurrencies,” she said. “We seek to develop a common framework for all countries to deal with this matter.”
It’s a call Sitharaman has issued before, citing the global nature of crypto assets. Her attention to the issue, amid India’s G20 presidency, has brought the discussions into the mainstream of the G20, an intergovernmental forum dedicated to addressing global economic issues.
India’s G20 presidency expires on Nov. 30 of this year.
India and Crypto
That this push is coming from the finance minister of India is interesting given that country’s history with digital assets. At various points, the Indian government has considered legal frameworks and even the outright banning of cryptocurrencies, before it moved toward such regulatory actions as mandatory reporting of crypto trading and investments by companies. Amid the skepticism of cryptocurrencies, the Indian government has embraced the blockchain technology underpinning the industry.
In February 2022, Sitharaman proposed a 30% tax on income from the transfer of digital assets, without deductions.
Rahul Pagidipati, the CEO of India-based cryptocurrency exchange Zebpay, told Entrepreneur India that he welcomes the move toward a global approach: “We strongly believe that a regulatory framework ensuring investor protection and a less restrictive tax policy will enhance the growth and adoption of crypto in India and around the world.”
The Drawbacks of a Piecemeal Approach
In the United States, regulators and lawmakers at the federal and state levels are grappling with how, when, and whether to impose restrictions on the nascent industry. The result, so far, has been a lack of coherence and an application of regulatory scrutiny that has drawn onlookers and ire.
A Javelin Strategy & Research report, Bitcoin Mining and ESG: The States Start Moving, detailed how states are taking positions to welcome or repel the industry, creating a mishmash that’s difficult to navigate. Although that report focuses on environmental, societal, and governance concerns, the lack of a steadying framework affects all elements of the industry. It’s a situation that’s likely to persist, given the disparate and varied interests.