India’s regulatory stance on crypto and Web3 won’t see legislative clarity until at least mid-2025, according to Jayant Sinha, Chair of the Standing Committee on Finance in India’s Parliament. In an interview during India Blockchain Week in Bengaluru, Sinha discussed the complexities surrounding the development of standards and the evolving global landscape.
Sinha highlighted three key considerations hindering the introduction of a crypto-specific bill. Firstly, the a need to identify powerful use cases for India. Secondly, the ongoing evolution of global standards, with 2024 being an election year for influential nations. Lastly, concerns stemming from the collapse of FTX and regulatory actions against Binance have added to the cautious approach.
Sinha emphasized the importance of witnessing impactful use cases before introducing legislation. With global standards still in flux and major elections in 2024, he expressed skepticism about the development of robust standards. The aftermath of the crypto market meltdown and the survival of the company’s post-regulatory actions also contribute to the cautious approach.
India’s Crypto Position
India’s position on crypto came into focus in September 2023 when it urged the G20 to adopt global crypto guidelines. Despite having its legislation in cold storage since 2021, India is unlikely to present a bill in 2024. Instead, policymakers may rely on policy decisions to act as a de facto regulatory framework aligning with the Financial Stability Board‘s recommendations by the end of 2025.
Cautious Approach to Crypto
Sinha echoed concerns voiced by India’s central bank regarding crypto’s feasibility in a country with capital controls. He stressed the need for caution due to the lack of freely tradable currency like in other economies. Despite reservations, Sinha acknowledged the revolutionary potential of Web3 technologies and urged the Web3 community to propose a regulatory framework for India.
Encouraging Industry Participation
Sinha encouraged Web3 entrepreneurs, developers, and enthusiasts to actively contribute by proposing a white paper or regulatory framework. This collaborative approach aims to ensure that India’s regulatory landscape aligns with the transformative nature of Web3 technologies.