2 days ago El Salvador made historic decision to move to adopt Bitcoin as legal tender, now things are looking brighter in India for crypto-enthusiasts.
Current signs shows government has moved away from its earlier hostile stance towards virtual currencies and will most likely classify Bitcoin as an asset class in India soon. Market regulator Securities and Exchange Board of India (SEBI) will oversee regulations for the cyptocurrency sector after Bitcoin’s classification as an asset class.
India’s crypto industry is also in talks with the finance ministry regarding the formulation of a new set of regulations and industry sources point out that an expert panel at the ministry is studying the matter.
The development comes days after the Reserve Bank of India (RBI), in a circular, directed banks to stop avoiding transactions involving virtual tokens citing its earlier 2018 circular, since it had been quashed by the Supreme Court.
A white paper by Indiatech.org suggests that India’s adoption of Bitcoin as an alternative asset class is more realistic.
Due to the volatile nature of digital currencies (prices fluctuate widely on a daily basis), it pointed, they cannot be regularly used as a payment instrument.
The paper also recommended taxing investments in cryptocurrencies, making them subject to the capital gains tax under the Income Tax Act.
