Govt To Release Policy Paper On Crypto Regulations Next Month

India is planning to release a discussion paper next month to explore policy options for cryptocurrencies as global acceptance of digital currencies grows, which is helped in part by US President Donald Trump’s support for the sector, according to a report by The Economic Times.

The paper will likely draw on a joint synthesis document prepared by the International Monetary Fund (IMF) and the Financial Stability Board (FSB), while also reviewing crypto regulations approaches from various countries. It is in the final stages and may be opened for public feedback soon.

India’s stance on cryptocurrencies remains cautious. In Budget 2022, the government introduced a 30 per cent tax on gains from virtual digital assets but clarified that this does not imply legal recognition. Additionally, crypto exchanges must register with the Financial Intelligence Unit (FIU) to enhance oversight.

The Reserve Bank of India (RBI) has consistently highlighted risks related to cryptocurrencies, including concerns over money laundering and terrorism financing, and is developing its own Central Bank Digital Currency (CBDC) as a secure alternative.

A senior government official told The Economic Times that the final policy will be developed only after extensive consultations and a detailed study of international regulations. “India will make decisions based on national interest and avoid hasty moves,” the official said.

The report also quoted Bharti Group chairman Sunil Mittal, who pointed out that the crypto market has accelerated rapidly in recent weeks, especially with increased support from the Trump administration, underscoring the need for India to establish a clear regulatory framework.

Recently, the courts also raised concerns about the lack of clear crypto regulations.

On May 19, the judiciary raised concerns about the absence of a clear cryptocurrency policy. During hearings, judges questioned why the government has yet to finalize regulations, pointing to the risks of an unregulated parallel market that could negatively impact the economy. They stressed the importance of proper oversight to keep such activities in check.

Following US President Trump’s support, the US has become increasingly pro-crypto. At a recent Bitcoin conference, US Vice President JD Vance encouraged the crypto industry to keep pushing Congress for laws that support digital currencies. Meanwhile, Pakistan also announced its bitcoin strategic reserve and allocated 2,000 MW of electricity to support crypto mining.