Indian investors have welcomed Bitcoins and have given it a significant place in their investment portfolios since the inception of bitcoins in 2009. However, the Reserve Bank of India has not been very keen on accepting this form of currency. It considers cryptocurrencies as something that people are inclined based on their self-interest. Since bitcoins’ popularity reached a new height in the year 2018, RBI could not keep up with its stance for long.
Looking at the global trends with respect to cryptocurrency, the Supreme Court had to flip its decision of 2018 to ban crypto-asset trading in March 2020. The Supreme Court’s latest decision was made as an obligation to protect human rights and based on proportionality.
The RBI had not banned virtual currencies in the first place. Further, the government had set up two committees to investigate the issue at hand, where both the committees had submitted draft bills that suggested contrasting opinions. This is how the Supreme Court had to dissolve its own statement.
In the present day world, bitcoins and other cryptocurrencies have enabled Indians to participate in the global ecosystem. Indians can now make simple, quick, and cost-effective transactions with any part of the world. Bitcoins and cryptocurrencies are considered to be the world’s highest-performing assets.
Though most of the investment markets crumbled during the pandemic and lockdown times, the cryptocurrency market performed steadily and reached new heights. It also created new job opportunities and helped employees retain their employment and upskill. The power behind cryptocurrencies is its ability to provide free and fast transactions. This investment category holds the potential to reform money.
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All this said it is time for the RBI, SEBI, and the government to consider coming up with regulatory policies and calibrate framework to back up the technological advancements. India has to stand tall among the other global economies and assure investors to go far and wide within the set legal and ethical boundaries.
Budget 2021
With the recent cyberattacks in the picture, the following regulatory standards must be addressed in Budget 2021 regarding bitcoins and other cryptocurrencies.
- Regulation on the flow of money.
- Identifying acts as rights, duties, and offences.
- Penalties pertaining to each identified offences.
- Recognising cryptocurrencies under commodity trading.
- Applicability of direct and indirect taxes.
- Keeping the government informed about the employments under blockchain technology.
Let us urge the government to implement these expectations one by one and eventually give it a proper structure. Though the complete implementation may take time, it will be great to initiate the government’s end on these matters related to cryptocurrencies. This gives a clear picture of the cryptocurrency trading and brings forward more people into the arena. This move can indeed make India compete with other developed economies through this industry.
For any clarifications/feedback on the topic, please contact the writer at apoorva.n@cleartax.in
