Traders and hodlers in India could be in trouble if they don't abide by the country's laws of trading, hodling, or anything with regards to cryptocurrency within regulated platforms. With that, only platforms that are regulated by SEBI will be allowed for all crypto activities.
Fines Could be Up to $2.7 Million Dollars
As per BloombergQuint's report, the maximum penalty for non-compliance with Indian government's policies regarding crypto could reach fines of up to 20 crore rupees or about $2.7 million dollars or land them one and a half years in jail.
Before the new regulations take full effect, according to the story by CoinTelegraph, Prime Minister Narendra Modi will most likely be giving crypto investors a deadline to comply with the government's new rules and declare their assets.
Only Exchanges Under SEBI Allowed
While the new regulatory environment within the country holds quite the uncertainty, reports have started indicating that investors' crypto should only be held in exchanges that are under the oversight of the Securities and Exchange Board of India, otherwise known as SEBI.
This would then mean that having private crypto wallets will no longer be legal under the newly proposed legislation. To add, investors who will use these private wallets could be subjected to the aforementioned judicial penalties.
Mondi's Government to Increase Stance Against Fraud, Money Laundering and Terrorist Financing
In addition, Modi's government is now planning to institute a minimum capital threshold when it comes to investing in cryptocurrencies. To expand, India is now taking a hard-line stance directly against crypto, which is due, partially, to the perceived rise when it comes to fraud, money laundering, and even terrorist financing in recent years.
Another element, however, is that the competition from privately-issued or privately owned cryptocurrencies would, theoretically, threaten the plans of the Reserve Bank of India to launch its very own digital rupee.
India 'Controversial' Crypto Bill
With that, the official text from the widely talked about "controversial" crypto bill within the country mentioned that they aim "to create" a facilitative framework when it comes to the creation of India's official digital currency, which is to be issued by the Reserve Bank of India.
It was also mentioned that the bill is seeking to prohibit all private cryptocurrencies within India. It will, however, allow for certain exceptions in order to promote the underlying tech of cryptocurrency and its main uses.
Read Also: Grayscale Survey Finds 26% of US Investors Now Owns Top Cryptocurrency
India Crypto Market Saw 641% Increase
The crypto market in India has managed to grow a whopping 641% in the year through June, as per a report from Chainalysis, a crypto analytics firm, as of October. To add, the government is currently considering taxing gains when it comes to digital currencies.
There have also been calls made to impose stricter rules when it comes to transactions in virtual coins due to the lack of regulatory nature within the business. In November, Mondi held a review meeting to discuss digital currency as per the article by Bloomberg.
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Written by Urian B.
