Indian Lawmaker Urges Legal Status For Crypto, Stablecoins To Prevent Them Going Offshore: 'Let Us Not Fear Innovation, Let Us Regulate It'

Core Viewpoint - The Indian government has delayed discussions on a cryptocurrency bill, prompting criticism from the Supreme Court for the lack of clear guidelines in the crypto sector [1][5]. Group 1: Regulatory Framework - Lawmaker Raghav Chadha emphasized the necessity for a "clear domestic regulatory sandbox" to classify cryptocurrencies as an asset class, which could generate billions in annual tax revenue for the government [2]. - Chadha pointed out the paradox of imposing a 30% tax on cryptocurrency gains without providing legal recognition or investor protections, urging the establishment of a regulatory framework for cryptocurrencies and stablecoins [5]. Group 2: Current Taxation and Market Impact - India currently imposes a 30% flat tax on income from virtual digital assets, including cryptocurrencies, along with a 1% tax on all transfers, regardless of holding period or income level [4]. - An analysis revealed that 72.66% of India's cryptocurrency trading volume, approximately $5.60 billion, occurred on offshore platforms, indicating that unclear regulations have led to the migration of around 180 cryptocurrency startups abroad [3].