Throughout the year, the Central Bank of India has repeatedly demonstrated its animosity towards cryptocurrencies by pushing for an outright ban. One man, India's Finance Minister Nirmala Sitarman, stopped parliamentary debate on this option for failing to introduce legislation.
“Cryptocurrency by definition has no boundaries,” he wrote to Parliament, stating that no regulation or prohibition could be effective “without meaningful international cooperation.”
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While the legitimacy of cryptocurrencies remains in limbo, Sitharaman was the main architect of the 2022 finance bill which plunged the ecosystem into difficult times, including heavy taxes on cryptocurrencies.
"I'm not waiting for rules to tax people who make profits," the source said when asked how a country could tax something it hasn't recognized as legal.
No official data on the size of the crypto market in India has been released; Estimates range from 20 million to 115 million investors, the latest figures according to a June survey by cryptocurrency exchange Kucoin.
The collapse of cryptocurrencies in India was especially brutal after the introduction of the most controversial 30% income tax and 1% withholding tax (TDS). In the 10 days since the introduction of the 30% tax on April 1, trading volumes on some exchanges have fallen by more than 50%. This was compounded by rising inflation, Russia's war against Ukraine, global crypto contagion, and investigations of at least 10 crypto exchanges (exact number unknown).
However, recently, after the sudden collapse of crypto derivatives exchange FTX among worldwide crypto investors, the Indian press praised Sitharaman for the preventative effect of crypto taxes, stating: “Indian investors have been largely spared from cryptos. surprised."
In this chaotic crypto economy, Sitharaman has risen to lead the global debate on crypto regulation. Starting in December, India will lead the G20 for a year and host the G20 summit in 2023. Whoever holds the chair sets top priorities, and Sitharaman has indicated that he will continue to develop cryptocurrency regulation. international priority under the Indian mandate.
In 2022, a strict tax on cryptocurrencies was introduced in India. Next year, it could shape crypto regulation for the whole world.