The Indian government is looking at regulating the country’s cryptocurrency exchanges to bring them under the purview of the existing legal framework, according to a local media outlet.
Indian crypto exchanges are expected to be brought under the Goods and Services Tax (GST) regime after a bill was passed in parliament. This will bring them into compliance with the one percent tax collected at a source that has been previously exempted from taxation due to exempting digital currencies such as Bitcoin or Ethereum from value-added taxes since two years ago when these coins were first created.
The estimated date for implementation will be rolled out later after discussions between India’s finance minister and other stakeholders about how best it can be done without hurting traders too much while also not “jeopardizing” their business models due to the uncertainty caused because there isn’t enough clarity yet regarding whether all cryptocurrencies should fall into.
The holy grail of investment is to take advantage of the tax code. The more you invest, the fewer taxes are due at year-end, and this way your profits can soar without any risk or work.
The new rules will require all crypto exchanges operating in the country to register themselves under Indian GST.
Crypto exchanges are being categorized by the government into three different groups. A report has detailed how they will be classified based on their function, type of activity for which they provide service or product to users, and whether this is merely an exchange between crypto coins themselves rather than fiat currency along with other factors like location.
Like it or not, the future of blockchain and cryptocurrencies lies in countries like India. The government might see this as an opportunity for economic growth and will be looking to invest heavily into research that could lead them down a path where they become leaders rather than followers on innovation trends such has been seen with other nations around Asia Pacific Region which have made waves recently-Japan (Crypto Lobby), South Korea(Coinone).
Dying for Regulation
India is a hotbed for cryptocurrency activity, with several exchanges popping up to cater to the growing crypto economy. However, not only have companies been hesitant about integrating them into their business models but also dealing directly in digital currencies poses legal risks due to unclear regulations — something which might change soon though.
Recently, the Indian government has been paying attention to cryptocurrency. The country’s finance minister met with crypto enthusiasts and experts recently in order to discuss how cryptocurrencies could be used for financial inclusion efforts within his nation.
Recently there have been many discussions about how this technology can be used in India and elsewhere for social good by reducing transaction times while solving problems such as money laundering or fraudulence. The Reserve Bank of India (RBI) is working closely together with other central banks around the world towards a regulatory sandbox model which will pave the way to innovation without compromising consumer protection measures.
The recent stance of the government has caused a major change in its approach to cryptocurrencies. The draft bill that was originally written to ban all cryptocurrency circulation within India is now less strict and includes some allowances for exchanges, wallets providers as well traders who engage with bitcoin on behalf of Indians without holding any Indian currency or bonds.
The bill was originally imposing tight controls on virtual coins by prohibiting residents from spending them outside its borders while at the same time making registration mandatory once someone wants to start dealing professionally using these digital currencies — but something more palatable finally resulted after months spent negotiating new language.
As cryptocurrencies became more popular in the country, local exchanges ran rampant with ads to attract customers. But now that regulations might restrict their ability to advertise freely – top exchange representatives abstained from running any advertisements. The rise of cryptocurrency popularity has spurred on an influx of advertising campaigns across all media streams until recently when it seems like this could change due to restrictions imposed by government agencies or other types of regulation (e..g., financial). With these changes coming soon, however; several leading crypto firms decided not just to run traditional commercials anymore but instead focus mainly on online content publishing such as blog posts and videos.