India Delays Crypto Regulation Citing Financial System Risks

India does not plan to regulate the crypto sector currently, citing risks to its financial system.

Key points from the report include:

The government believes regulating crypto could make it systemic and harder to manage.
A complete ban might eliminate speculative activities but would not prevent decentralized trading.
Current oversight is limited to tax and anti-money laundering frameworks.
Indians hold $4.5 billion in crypto, deemed insignificant for financial stability.
Previous attempts to regulate crypto were postponed; a 2021 bill to ban private cryptocurrencies was shelved.
The Reserve Bank of India recently fined P2P platforms over ₹75 lakh for non-compliance with lending guidelines.
Global exchanges can register in India after compliance checks but are excluded from mainstream finance.
The government considers existing regulations sufficient to mitigate speculative risks.

Regional Developments

Contrasting India's stance, several Asian countries are advancing crypto adoption:

Singapore has implemented a Payment Services Act for digital tokens.
Pakistan is establishing a national Bitcoin reserve and allocating surplus electricity for mining.
Kazakhstan plans a crypto reserve fund to enhance its economy.
Thailand launched the “TouristDigiPay” initiative to allow crypto conversions for tourists.