Former Reserve Bank official pushes for India to accept crypto

The former Deputy Governor of the Reserve Bank of India (RBI) has spoken out about the nation’s financial and crypto ecosystem and stated that digital assets need to be accepted.

Former Reserve Bank official pushes for India to accept crypto

On the inaugural HODL ’21 virtual conference organized by the Blockchain and Crypto Assets Council (BACC) of the Internet and Mobile Association of India (IAMAI) on Sept. 7, Rama Subramaniam Gandhi said that crypto could be used for payments for economic activities but he sees them more as an asset class.

While the regulatory situation in the country remains unclear with bills and legislation still being mulled by politicians. Earlier this month, the government announced that it was working on a draft bill to define cryptocurrencies as commodities where they could be taxed. If the bill passes, it would not be allowed to be used for payments, but traded and invested in as assets instead.

Rama Subramania, who served at the central bank from 2014 to 2017, maintains that cryptocurrency needs to be treated as an asset or commodity and taxed accordingly. Developing a regulatory framework and treating them as such would allow Indians to invest and hold digital assets. If the assets have been mined instead of purchased, they should be subject to capital gains tax, he added.

According to the former central banker, cryptocurrencies would be used for crimes if there were no regulations or government oversight. He said that transactions could be tracked through a central repository to facilitate trade and prevent illicit use.

Gandhi stated that the government should have an open mind toward economic transactions involving cryptocurrencies, but cautioned about the anonymity features that some blockchains have, adding that society must adhere to any compliance rules set by the state.

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