As Bitcoin surges toward the $80,000 mark, global interest in cryptocurrencies is rekindled. However, India remains slow in developing a robust regulatory framework, despite its significant presence in the global crypto landscape. A recent Chainalysis report places India at the top of the Global Crypto Adoption Index for 2024, highlighting the nation’s growing engagement with digital assets.
G20 Roadmap Stresses Regulation, Not Bans
During India’s G20 presidency in 2023, Finance Ministers and Central Bank Governors endorsed a roadmap for cryptocurrency regulation proposed by the International Monetary Fund (IMF) and the Financial Stability Board (FSB). The strategy rejected a blanket ban on crypto-assets, favoring a comprehensive regulatory and supervisory structure instead.
The New Delhi Declaration further backed FSB recommendations for oversight of crypto activities and global stablecoin arrangements. Yet, as Brazil prepares to host this month’s G20 summit, marking the end of its presidency, India’s progress on implementing these regulatory measures has been limited.
Minister of State for Finance, Pankaj Chaudhary, acknowledged in July that all jurisdictions, including India, were expected to assess country-specific risks while engaging with global standard-setting bodies. “Necessary measures” were anticipated, but concrete advancements remain absent.
Mounting Urgency Amid Pro-Crypto US Leadership
Himanshu Maradiya, Founder and Chairman of CIFDAQ, emphasized the urgency for India to address its crypto regulatory gaps. “India was expected to release a discussion paper in September to clarify its stance on cryptocurrencies. However, the paper remains pending, even after a $234-million hack affected one of the nation’s leading exchanges,” he stated.
Maradiya noted that recent developments, such as Donald Trump’s return to the US presidency, could pressure India to accelerate its regulatory efforts. Trump’s pro-crypto stance includes promises to position the US as a global crypto leader and advocate for Bitcoin as a strategic reserve.
“There is a high likelihood that India will prioritize publishing its discussion paper this calendar year,” Maradiya said. He added that this move would align with India’s objectives during its G20 presidency, which emphasized coordinated regulation to manage crypto risks.
Trump’s Presidency Signals Global Shifts
Edul Patel, CEO and Cofounder of Mudrex, believes Trump’s win could serve as a turning point for global cryptocurrency regulation. “Trump’s campaign promises, such as establishing the US as a crypto capital, signal a bold regulatory shift that may influence other nations, including India,” Patel remarked.
With global crypto markets responding to regulatory signals from major economies, the spotlight remains on India to clarify its policy direction. As the world watches Bitcoin’s historic climb, the question remains: will India seize the moment to lead in crypto regulation or continue to lag behind?
