On Tuesday, Bloomberg India revealed that the penalty for non-compliance with the Indian government’s cryptocurrency guidelines will range from a maximum fine of 20 crore rupees ($2.7 million USD) or 1.5 years in prison.
The Indian Prime Minister Narendra Modi will most likely give existing cryptocurrency investors a deadline by which they must comply with new rules and declare their assets.
There is currently a high degree of uncertainty in India over the regulatory environment. Reports have indicated that investors’ crypto must be soon be held in exchanges that are operated by the Securities and Exchange Board of India (SEBI).
Under the proposed legislation, private wallets will not be legal and if found using them, investors could face serious penalties. Additionally, the Prime Minister’s government plans to institute a minimum capital threshold for investing in cryptocurrencies across the country.
India’s tough stance against crypto comes after a rise in fraud, money laundering, and terrorist financing in the industry over recent years. There are also worries that privately-owned or issued crypto assets could threaten the Reserve Bank of India’s plans to release it’s own digital rupee. The official text from an ongoing controversial crypto bill in the country is as follows:
“To create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India. The Bill also seeks to prohibit all private cryptocurrencies in India; however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses.”
As the text says, India’s new bill will make some expectations for new innovations so that country does not fall behind new technological advances. It is unclear exactly what these expectations will be however many speculate that the country will still allow certain research and development to take place.
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