Finance Secretary: Indian crypto regulation awaits approval

June 04, 2019 | AtoZ MarketsIndia’s new finance secretary Subhash Chandra Garg has confirmed that the report detailing the country’s crypto regulation is ready and soon will be submitted to the finance minister for approval. How soon the crypto community should expect to see the new Indian crypto regulation? 

Indian crypto regulation a never-ending story

As per local media, the report containing the recommended crypto-related regulations is ready to be submitted to the finance minister, after more than a year of analysis and deliberation. The possible release of the report detailing new Indian crypto regulation was also confirmed by the country’s new finance secretary, Subhash Chandra Garg, at an even, recently hosted by the Associated Chambers of Commerce and Industry of India.

Garg, who is also a former Secretary of the Department of Economic Affairs (DEA) leads an inter-ministerial committee which studies all aspects of cryptocurrency and drafts the country’s crypto regulation. The Finance minister of India outlined, that once the new Indian crypto regulation report is confirmed, it will be published.

According to the local media reports, the draft on crypto regulations was supposed to be ready in July 2018. At that time Garg explained that the inter-ministerial committee had prepared a draft which supposed to be discussed with committee members. However, the aforementioned document was not published then. The same year, in December the Ministry of Finance, noted that it was difficult to determine a specific timetable in order to come up with clear recommendations.

In February 2019, the government said to the supreme court that the report containing the recommendations for India’s crypto regulation is in the final stages of deliberation.

A formal announcement from the government, as well as the supreme court, is expected on July 23. The court is expected to address two crypto-related issues: the regulatory framework recommended by the Garg committee and the banking restriction by the central bank.

DEA rejects RTI requests

Another evidence that the new crypto regulations project might soon to be published, is the government’s response to a Right to Information (RTI) request filed by the founder of local news platform Naimish Sanghvi. He asked the DEA about the report “The Law on the Prohibition of Cryptocurrencies and Regulation of Official Digital Currencies of 2019”.  

“RTI was filed on April 26, a day after the reports appeared. On May 20, 2019, the DEA rejected the RTI application with reference to “Section 8 (1) (i)” as the reason for the rejection, ”shared the aforementioned media resource. The publication suggested, that the DEA rejected RTI request because “ultimately the information must be made public.”

Another media resource reported last month that the bill was sent to the relevant government departments for discussion, citing an unnamed government official claiming to know the details of the bill.

Crypto community’s campaign on Indian crypto regulation

In April 2018, the Reserve Bank of India issued a circular prohibiting regulated financial institutions from providing services to crypto businesses. Banks subsequently closed accounts of cryptocurrency exchanges. The aforementioned restrictions on crypto encouraged the local community to start the campaign. The activity aim was to impact local lawmakers and end to the banking restriction.

For example, 213 days ago, Nischal Shetty, CEO of local crypto exchange Wazirx started a social media campaign dubbed as “India Wants Crypto” for positive crypto regulation.

In his speech addressed to the community, Shetty he urged the finance minister to introduce positive crypto regulation. He noted, that “positive crypto regulations in India will help create wealth and jobs for millions of Indians.”

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