Rypto not currency, eeds to be regulated s asset: EX-RBI DG
Former RBI deputy rnor R Gandhi on Tuesday e a case for treating and regng crypto as a separate asset s with a view to enabling rnments around the world fectively deal with illegal ities associated with virtual encies. ter quite a lot of debate over ears, he said, people have understood that crypto canbe a currency because the amental element of a curythat it should be a legal er- is missing in this case. e said that in this case, one ot compel a crypto currency accepted by another person is not a legal tender. he general consensus among y policymakers is that it ld be deemed as an asset, s a currency, not as a payt instrument and not as a ncial instrument as there is lear identified issuer, he indicating that.
So, he said, any jurisdiction should have a clear framework by which any part of the economic activity should not be seen as supportive of any criminal activity.
“So that is where the real difficulty comes in vis-à-vis a crypto assets as there is a possibility, and not really a possibility, there has been quite a bit of an anecdotal evidence that crypto assets have been utilised for increasingly, or in large scale, for illegal activities like ransom attacks etc,” he said.
He said that the basis of origination of crypto some 12 years back as an asset was that it cannot be traced and taxed.
“So the very idea of crypto was that it should be anonymous, independent, and it cannot be taxed or tracked, so as I said every society will have its own rules, which expects compliance by all its members and it penalises non-compliance,” he said.
Last month, finance minister Nirmala Sitharaman had said proposed legislation regarding cryptocurrency is pending before the Union Cabinet.
The inter-ministerial panel on cryptocurrency, under the Chairmanship of Secretary (Economic Affairs) to study the issues related to virtual currencies and proposed specific actions, has already submitted its report.
It has recommended that all private cryptocurrencies, except any virtual currencies issued by state, should be prohibited in India.