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Regulating Crypto: A glance at what the other countries have done

Take a look at the regulations adopted by countries across the globe as India is indicating towards regulating or banning cryptocurrencies.

 The Government of India has brought a bill proposing regulation and restricting cryptocurrency in the country. According to a report by PTI, the new bill may contain the proposal of banning private cryptocurrencies with a shocking announcement of bringing its centralised cryptocurrency regulated by the Reserve Bank of India.

The news created a panic situation in the stakeholders of crypto and as a result, they requested the Central government to have a “nuanced approach” in the matter.

 Here are the policies and regulations applied by the international community around the world:

 United States: The US has rules regarding this which differ from state to state.

However, it is overall positive.

 –    For example, the state of New York favours crypto and thus introduced a licensing framework in 2016 naming ‘Bitlicense’ for all these.

 –   According to this framework, companies have to get licenses from the State Department of Finance for exchanges in crypto.

 Overall, there are many announcements and rules, which indicate a positive response of the US towards cryptocurrencies.

China: China has changed its stance since the beginning of the cryptos, the Chinese authorities initially welcomed crypto mining and then scrapped all the crypto supporting laws and completely banned it in June 2021. This move alone resulted in a decrease of 40 per cent of total crypto mining operations.

–  However, China is developing a digital version of its currency Yuan.

United Kingdom: the UK currently does not have certain directions on cryptocurrencies and Financial Conduct Authority (FCA) currently governs this sector

 – The FCA has also developed a set of rules for those who trade in cryptocurrencies.

– However, the UK imposes various taxes on cryptocurrencies just like any other trade by using her corporate tax rules.

– Not only this, but the related firms also have to comply with CTF (Counter Terrorism Fund) and AML (Anti Money Laundering) initiatives.

European Union: As it is a union of different countries, there are no specific regulations regarding this. But, they all have a ‘soft corner towards cryptocurrencies.

– There was a draft named Markets in

Crypto-Assets Regulation (MiCA) was released in September, last year.

Singapore: Singapore has introduced a set of “clear rules” where this sector is implemented under the Payment Services Act of Singapore.

–      However, trading in cryptocurrencies require a license and also the firms have to follow the laws regarding AML and CTF.

El Salvador: This small country situated in South America was the first country that declare Bitcoin a legal tender.

–      The parliament of El Salvador passed a law that gave crypto money the same status as the US dollar. 

–      Although, the majority of the population rejected the idea and continued to use the US dollar 

Where does India stand?

The latest bill to be introduced in the Indian Parliament seeks to ban private cryptocurrencies in India, although, it will allow some exceptions to promote blockchain technology.

 –  Although there are no regulations over cryptos, PM Narendra Modi indicated that very soon there will be some.

–  The RBI doesn’t favour cryptocurrencies and this can be easily sensed by the statements of the RBI governor who constantly says that these are a threat to any financial system as they are unregulated.

– Recently, a survey was done by LocalCircles turned out that a majority of people are not in favour of legalising it, but they want it to be a digital overseas asset. The sample size of the survey was about 56,000 people from 342 Indian districts.