Whether Cryptocurrencies Is Legal In India?
The Supreme Court has asked the Centre whether dealing with cryptocurrencies like bitcoin is legal in India.
- The Court posed the query while hearing a plea by one of the accused in the GainBitcoin scam, seeking quashing of the charges against him.
- There’s no formal regulation on cryptocurrencies in India so far. The Centre has been working on crypto regulatory framework since 2019 but is yet to introduce a bill.
- The central bank has always maintained a strong stance against private digital currencies. It had banned the banking system from aiding such trades, which was struck down by the Supreme Court in 2020.
- In Union Budget 2022, finance minister Nirmala Sitharaman had proposed 30 per cent tax on earnings from cryptocurrencies and non-fungible tokens (NFTs).
- She also said that losses from their sale could not be offset against other income, delivering another disincentive to trading and investment in digital assets.
- The government also introduced 1 per cent tax deducted at source (TDS) on digital assets.
- It also announced that RBI will introduce its digital currency in FY23 that will lead to more efficient and cheaper currency management system.
- Cryptocurrencies are digital currencies in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank.
- They use Blockchain technology.
- Examples: Bitcoin, Ethereum etc