• The International Monetary Fund (IMF) and the United States have expressed support for India’s plan to coordinate global crypto regulation at the G20 meeting.
• The U.S. Treasury Secretary Janet Yellen has said it is important to put a strong regulatory framework in place, but not outright ban cryptocurrencies.
• In contrast, IMF Managing Director Kristalina Georgieva has suggested that banning crypto should be an option.
India’s Plan For Global Crypto Regulation At G20
The International Monetary Fund (IMF) and the United States have shown support for India’s plan to coordinate global crypto regulation during the recent G20 meeting. India, which currently holds the G20 presidency, has been pushing for a collective global effort to regulate the nascent digital asset industry and mitigate its potential risks. During the latest G20 meeting, which ended on Saturday, the country’s finance minister held a seminar for member states to share their concerns regarding the risks of cryptocurrencies while discussing how to come up with a common framework.
Support From The U.S.
Speaking to Reuters on the sidelines of the G20 meeting in Bengaluru, U.S. Treasury Secretary Janet Yellen said it was “critical” to put in place a strong regulatory framework but added that the United States had not suggested any outright bans.”We haven’t suggested outright banning of crypto activities, but it is critical to put in place a strong regulatory framework. We’re working with other governments.”
In contrast, IMF Managing Director Kristalina Georgieva told reporters after co-chairing a meeting with Indian Finance Minister Nirmala Sitharaman that banning crypto should be an option. The Reserve Bank of India (RBI) has long maintained a harsh stance toward digital assets, arguing that the nascent asset class has no underlying value. The central bank has constantly warned investors and the government against crypto, citing volatility as well as risks of fraud and scams. Just earlier this year, India’s central bank governor Shaktikanta Das said cryptocurrencies don’t have any intrinsic value and their perceived “value is nothing but make-believe.” He said cryptos are not even worth a tulip, alluding to well-known Dutch tulip mania blow-up in early part of past century .
Controversial Tax Laws
Despite calls by RBI to ban cryptocurrencies ,the Indian government has debated drafting law to regulate them .In July last year ,the Indian Government said global collaboration would be required for effective regulation or ban on cryptocurrencies .India’s controversial crypto tax plans including 30% tax on income from cryptos & 1% TDS at time of payment of crypto transfer ,have adversely impacted trading activities within country’s cryptocurrency industry .
It is clear that both US & IMF are supportive towards India’s initiative of regulating cryptocurrencies through coordinated efforts among G20 countries .However ,India seems divided between two sides whether they should ban or regulate cryptocurrencies amidst increasing frauds & scams in sector . In such circumstances ,a consensus is needed amongst stakeholders before taking any policy decision .