Indian Government Updates Parliament on Cryptocurrency Bill and Investigations of Crypto Exchanges – The Indian government responded to two sets of questions about cryptocurrency and its regulation posed by members of the Lok Sabha, India’s lower house of parliament, on Monday. Parliament member Bhartruhari Mahtab asked the finance minister to explain “the current status of the cryptocurrency bill, which was due to be tabled during the winter session of the Parliament in 2021,” as well as “the timeframe within which the cryptocurrency bill would be tabled and subsequently open for public inputs.”
Pankaj Chaudhary, minister of state in the Ministry of Finance, replied without providing a specific timeframe: “Crypto assets are by definition borderless and require international collaboration to prevent regulatory arbitrage. Therefore, any legislation on the subject can be effective only with significant international collaboration on evaluation of the risks and benefits and evolution of common taxonomy and standards.”
Mahtab further asked the finance minister to state which ministry and/or department would regulate cryptocurrencies and crypto tokens, and which would regulate other types of “virtual digital assets,” such as non-fungible tokens (NFTs), decentralized applications (dApps), real estate tokens, and other blockchain-based assets. Chaudhary simply replied: “Currently, policy related to crypto assets and related ecosystem is with the Ministry of Finance.”
People Also Read: Binance US Plans to Acquire Voyager Digital’s Assets for $1 Billion in Bankruptcy Bid
Members of Parliament Have Also Requested Information on Cryptocurrency Exchanges Under Investigation
Several other parliament members have asked for information of crypto exchanges that are being investigated by the authorities for money laundering and tax evasion crimes. The Enforcement Directorate (ED), according to Chaudhary, “is investigating several cases related to crypto frauds wherein a few crypto exchanges have also been found involved in money laundering.”
The minister explained that as of Dec. 14: “Proceeds of crime amounting to Rs. 907.48 crores have been attached/seized, three persons have been arrested and four Prosecution Complaints have been filed before the Special Court, PMLA, in these cases.”
Furthermore, assets totaling Rs. 289.68 crores ($35,046,152) have been seized under the Foreign Exchange Management Act 1999 (FEMA). Furthermore, one Show Cause Notice has been issued under FEMA to Zanmai Labs, which operates the crypto exchange Wazirx, and its director for transactions involving crypto assets worth Rs. 2,790.74 crores.
According to the minister, 12 bitcoin exchanges have been investigated for dodging Goods and Services Tax (GST). So far, 110.97 crore rupees have been collected, including interest and penalties. In addition, eight instances are being investigated further, and four cases have been closed.
People Also Read: Bank of Russia Moves to Safeguard Crypto Companies Against Sanctions
Chaudhary also clarified: “Currently, crypto assets are unregulated in India. The government does not register crypto exchanges.” India’s finance minister, Nirmala Sitharaman, said in October that the government plans to discuss crypto regulation with the G20 countries to establish “a technology-driven regulatory framework” for crypto.
Last week, India’s economic affairs secretary, Ajay Seth, stated that the G20 nations hope to reach a policy consensus on crypto assets in order to improve global regulation. During the ninth India-US Economic and Financial Partnership conference last month, US Treasury Secretary Janet Yellen and Sitharaman discussed crypto regulation.
