Why India might classify Bitcoin (BTC) into a new asset class
Recent reports suggest that the Indian government might opt to classify Bitcoin (BTC) as an asset class, which would make it possible for Indian investors to continue trading in the crypto.
Mon, 14 Jun 2021, 12:50 pm UTC
A series of positive developments, such as El Salvador granting Bitcoin legal tender status and Elon Musk hinting that Tesla might resume BTC payments, have helped push the market upwards. At the time of writing, BTC traded at $ 39,311.63, up 9.14 percent in the last 24 hours based on Coindesk data.
Positive developments might be happening in India’s crypto space as well. Recent reports suggest that the Indian government might opt to classify Bitcoin (BTC) as an asset class, which would make it possible for Indian investors to continue trading in the crypto.
Sources say that Finance Ministry plans to establish an expert panel to study the formulation of a new set of regulations that will govern the crypto industry, according to NewIndianExpress.com. The Securities and Exchange Board of India (SEBI) will oversee the implementation of these regulations, which will likely happen after Bitcoin’s classification as an asset class, the sources added.
According to Business Insider, the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 was supposed to be discussed during last March’s Parliament’s Budget session. However, the second wave of COVID-19 infections cut the session short. The bill is expected to be up for discussion by next month during the Monsoon session of Parliament.
In a brief posted on the Parliament session agenda, the crypto bill aims to “create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India (RBI).” At the same time, it seeks to “prohibit all private cryptocurrencies” in India, which has led to many speculations about how the government defines a “private cryptocurrency.”
According to Business Insider, classifying BItcoin as an asset class might “take it out of the purview of private cryptocurrencies and make it akin to gold and other taxable assets.” This means that BTC will survive even if the crypto bill is approved.
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