Finance Minister Nirmala Sitharaman informed Rajya Sabha on July 27 that the Indian government does not collect any data on the cryptocurrency market and does not know the number of active cryptocurrency exchange platforms or users in the country.
Sitharaman was responding to a question from Rajya Sabha MP and former Bihar deputy chief minister Sushil Kumar Modi, who had raised the issue during the previous session. A spokesperson for the finance ministry stated that no information on whether some of these exchanges are involved in narcotic drug trafficking or money laundering has been received by the ministry.
During a response to Modi’s question about the number of active platforms in the country, Sitharaman stated that “this information is not collected by the government.”
The Indian government initially took a hard line against cryptocurrencies, but as the use of digital currencies has grown in popularity in the country over the last few months, the government’s stance has softened.
The finance minister also hinted that investors who purchase cryptocurrencies from countries other than India may not be required to pay an equalisation levy on their purchases in India.
Modi confronted her with the issue in question. The former Bihar deputy chief minister inquired as to whether the central government intends to impose an equalisation levy on investors who have purchased cryptocurrency from foreign sources.
As a result, Sitharaman responded, “The equalisation levy is imposed on the e-commerce operator, not on the investor.”
While the government may not have data on cryptocurrency exchange platforms or the number of active users, the crypto industry estimates that more than 1.5 crore investors have purchased cryptocurrencies worth Rs 15,000 crore, according to industry estimates.
Significant coins such as Bitcoin and Ethereum have seen an increase in popularity in the country since the beginning of this year in particular. As a result, it would be reasonable to assume that the number of cryptocurrency investors is increasing at a rapid pace.
The Indian government had announced plans to impose a ban on cryptocurrencies earlier this year, and a Cryptocurrency Bill was expected to be tabled during the Budget session of Parliament.
It was postponed while a committee was formed and additional discussions were held with representatives from the industry. It is unlikely that the bill will be introduced during the monsoon session of Parliament as well.
This is because the government wishes to make a well-informed decision on cryptocurrency.
In the past, reports have suggested that the government may not impose a blanket ban on cryptocurrencies, but instead may consider classifying them as digital assets.
Even though the government appears to be flexible when it comes to cryptocurrency, the government still faces significant challenges from a variety of directions.
One of them is from the Reserve Bank of India, which has announced plans to launch its own digital rupee soon.