Crypto currencies and their rising popularity have been keeping the governments of economically influential countries in concern mode. India’s financial minister Ms. Nirmala Sitharaman has also expressed India’s main worry with regard to Crypto Currencies saying that biggest risks of crypto currencies are their possible use in money laundering and financial terror.
Sitharaman also stated that all countries should come together to discuss regulating the crypto currencies in unified manner. She proposed a global collaboration to curb misuse of crypto currencies, as reported by ET.
Nirmala Sitharaman is in Washington DC to attend International Monetary Fund (IMF) and the World Bank’s spring meet. She is there to meet all the business leaders in the G20 Finance Ministers and Central Bank Governors meeting (FMCBG).
Nirmala Sitharaman, the finance minister of India has picked out money laundering and terror financing as the prime risks associated with Cryptocurrencies.
On behalf of India, Finance minister has asked for a joint effort on international front to regulate crypto currencies. She has identified the misuse of cryptocurrency in the crimes like money laundering and terror financing as a big threat to the world economy.
On the very first day of the meet, Finance Minister participated in a panel discussion on “Money at a Crossroad” hosted by Kristalina Georgieva, Managing Director, IMF, and remarked, “I think the biggest risk for all countries across the board will be the money laundering aspect and also the aspect of currency being used for financing terror. “We are at the crossroads around how fast, how far, and in what proportion, but I see this as a one-way street in which Digital Money is going to play a bigger role,” the IMF chief said remarked in the same event, as reported by another portal.
Ms. Nirmala Sitharaman emphasized that since Cryptocurrencies have a global proliferation now, therefore they could not be handled by any one country alone. She further added that in order to regulate crypto world, all countries need to join hands together.
“I think regulation using technology is the only answer. Regulation using technology will have to be so adept, that it has to be not behind the curve, but be sure that it is on the top of it. And that’s not possible if any one country thinks that it can handle it. It has to be across the board,” Sitharaman said.
The finance minister also gave a reference of new tax regime for Indian crypto investors. She said that by bringing in 30% tax on income from Crypto assets will help the government in keeping a track record of the transactions.
It may be recalled that India has passed Financial Bill in its parliament during budget session in February-March 2022 for imposition of 30% tax on all incomes generated from sale and purchase of crypto currencies or digital assets.
Moreover, the Government has also prohibited adjustment of gains made from one particular crypto currencies or digital asset with loss accrued in another crypto currencies or digital asset.
“How can we keep a trail following these transactions which were happening. After all these were electronic codes eventually. So, we wanted to be sure. So, through that (30% tax) we will be able to know who’s buying and who is selling it,” Sitharaman said.
Ms. Sitharaman also pointed that the rate at which digital adoption is increasing in India is alarming. She also threw light on the efforts made by the Indian government to cater to the need of expanding demand by widening digital infrastructure framework in the last decade.
“If I use 2019 data, the digital adoption rate in India is about 85 per cent. But globally that same year it was only somewhere near 64 per cent. So, the pandemic time actually helped us to test and prove for ourselves that it is simple to use, common people can use it, and adoption actually was proven,” Sitharaman said.
After attending Spring meet in Washington, Nirmala Sitharaman will move to San Francisco on April 24 to hold an interactive session at Stanford University with the students. She will also be meeting business leaders from all over the world.
The anxiety shown by Ms. Sitharaman reflects the general attitude of dislike by governments across the world towards crypto currencies.
