On Monday, Finance Minister Nirmala Sitharaman told the International Monetary Fund (IMF) meeting in Washington D.C. that she is very strict about crypto.
The Finance Minister said that crypto could be used to launder money and fund terrorist groups. Therefore, Sitharaman called for a global approach to crypto regulation that would be better for everyone.
On the other hand, the Finance Minister supports the idea of central bank digital currencies. According to her, this is a better idea than cryptocurrency. Meanwhile, a few weeks ago, India put a 30% tax on digital assets, which was meant to scare investors away from trading them.
Concerns About Crypto Use
Sitharaman was on an International Monetary Fund (IMF) panel called “Money at a Crossroads.” She talked about the unregulated crypto market, money laundering, and financing terrorist groups.
In addition, she said that making cross-border payments with unhosted crypto wallets is risky. In regard, this needs to be regulated by all countries. However, she noted a possible solution that will make cross-border payments better. According to her, this would be through central banks’ use of central bank digital currencies.
In a statement, Sitharaman noted that technological regulation is the only way to solve the issues. She emphasized that technology-based regulation must be so proficient that it is not just ahead of the curve but also on top of it. Moreover, Sitharaman said that if any country believes it can manage it, then it must be universal.
Worth noting, Sitharaman said that India is becoming more and more digital. Statistics show that 1 in 4 start-ups in the fintech industry are becoming unicorns. In the last two or three years, there have been 20 unicorns in the fintech industry.
Following the panel discussion, there were also other important participants. The panel included Kristalina Georgieva, the managing director of the IMF, Roberto Campos Neto, the President of the Central Bank of Brazil, and Ravi Menon, the managing director of the Monetary Authority of Singapore.
Exchanges and Investors Are Confused by Indian Crypto Laws
Following the start of April, several crypto exchanges started accepting UPI as a payment method. However, India’s payments regulator said that it did not know about this.
As a consequence, Coinbase, CoinDCX, and WazirX, three crypto exchanges in India, no longer accept UPI payments for crypto. This confusion about the payment system resulted in a big drop in the amount of crypto trading in India. Also, there was a 30% tax set up on digital assets.