Crypto -currency research concept with keyboard and magnifying glass. 3D Render | Photocredit: Asbe
India tends to not create legislation to regulate cryptocurrencies in the country and will be partially supervising instead, for fear that bringing the digital assets in its regular financial system could increase systemic risks, a government document shows.
The Documentcites The Reserve Bank of India’s (RBI) believes that in practice the risks of cryptocurrencies would be difficult through regulation.
The global acceptance of cryptocurrencies has improved since the US President Donald Trump took office and the prizes of Bitcoin, the world’s largest crypto-asset through market capitalization, have reached record highs.
The US has also adopted legislation that makes it possible to use stablecoins, which are cryptocurrencies, supported by Fiat -currencies, making them less vulnerable to wild rocks.
China continues to forbid cryptocurrencies, but is considering a Stablecoin supported by Yuan, Reuters reported last month. Although Japan and Australia develop regulatory frameworks for such virtual assets, they retain a cautious attitude without actively promoting the sector.
Regulating cryptocurrencies in India would give them “legitimacy”, and “can ensure that the sector becomes systemically,” said the government document, drawn up this month.
Although an outright prohibition, on the other hand, can tackle the “alarming” risks of largely speculative crypto assets, it would not be able to tackle peer-to-peer transfers or transactions on decentralized fairs, it added.
The formal views of the Indian government have not been reported before.
The Federal Financial Ministry of India and the RBI did not immediately respond to Reuters’s request for comments.
In 2021, the government drawn up a bill to ban private cryptocurrencies, but did not continue the legislation.
During his G20 presidency in 2023, India had called for a global framework to regulate such assets. In 2024, the government was planning to publish a discussion document about her crypto attitude, but it postponed, and said it would revise the issue after the US formalized the use of cryptocurrencies.
Currently, global crypto -fairs can be active in India after they have registered locally with a government agency in charge of due diligence to check money laundering. Punitive taxes are imposed on profit of cryptocurrencies.
But the central bank has repeatedly warned against the risks when dealing with them, which leads to an almost freezing of trade between the formal financial system of the country and cryptocurrencies.
Indians have investments worth $ 4.5 billion in different cryptocurrencies, and the use of such assets is currently neither significant nor a systemic risk for financial stability, according to the document.
The current limited regulatory clarity has contributed to the risks of cryptocurrencies on the regulated financial system, said it. The current tax and other laws act as a deterrent for speculative trade in cryptocurrencies, and punish fraud and illegal activities, it added.
Since the regulatory approach to cryptocurrencies varies worldwide, “mapping a clear way forward or identifying a uniform policy approach is not easy,” the document said.
Stable coins
On July 18, Trump signed the brilliant law in law, the adoption of federal rules and guidelines for cryptocurrency tokens linked to the US dollar known as Stablecoins.
The document said that the approval by the US of dollar-supported Stablecoins and promoting their use and payment instruments will influence both advanced and emerging economies.
This would require “accurate research” by the government, since most stablecoins were linked to the US dollar in circulation worldwide, said it.
Stablecoins target price stability, but can fluctuate as a result of market shocks or liquidity restrictions that influence the financial markets, according to the document.
The widespread use of stablecoins could fragment national payment systems such as fast interbancar transfers and weaken the country’s digital payment system, Unified Payment Interface (UPI).
Published on September 10, 2025
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