Anonymous sources say that the Government of India may bring crypto regulation by defining it as a commodity. The new draft crypto bill “proposes to compartmentalize virtual currencies on the basis of their use cases.”
On September 3, Economic Times (ET) reported the news, citing 3 anonymous persons as the sources, that the Government of India may regulate cryptocurrencies soon.
The Information from the ‘Anonymous Sources’
The Government also seeks to define and categorize digital assets based on their end uses.
ET’s report says that “the government’s focus would be based on the end-use of the asset for regulatory purposes.”
The bill will also define the different nuances or ways taxes can be levied on digital assets depending upon their specific natures and use cases.
“The government in its draft bill is working towards defining cryptocurrency and its treatment in various use cases so that it can be treated correctly in the books of accounts plus it should be taxed in the right manner. It is not looking to allow payments and settlements through virtual currencies”, a person in the know said as quoted by ET.
Currently, the elephant in the room is whether digital assets are currency, commodity, service, or closer to equity. The people close to the matter claim that firstly the government is contemplating on how to define cryptocurrency.
“Crypto-assets can be either categorized on the basis of the technology they use or they can be defined on their end-use. So, before talking about how the regulations should work, the government has to spell out what it means by cryptocurrencies,” said one of the sources.
Also mentioned is that only the cryptocurrencies eligible as per the definition of the Government will be allowed to trade in India, the report says.
The news can change too in future.
The sources in the know have not released any official statements, so we cannot take their words for granted. Their claims may be veracious, but the news can change in the future as the Government has not released any official notification.
The Union Minister of Finance, Smt. Nirmala Sitharaman had earlier said, “We will have to take a very calibrated position.”
The ‘Calibration’ can change with time too. So, this news is just plain speculation until the Government releases the bill officially.
No concrete news has appeared on the crypto bill in the past year. In fact, the same statements have been repeated by the Finance Minister since July 2020.