Indian Reserve Bank (RBI) Governor Sanjay Malhotra said on Friday that the central bank is concerned about cryptocurrency, as it may disrupt financial stability. Malhotra was asked about the development of the Supreme Court on Cryptocurrency last month’s remarks on cryptocurrency during a conversation with journalists after presenting the second bilateral monetary policy review of the current financial year 2025-26. He said that there is nothing new to tell in the case of Crypto. Malhotra said, “A committee of the government is keeping an eye on it. Of course, as you know we are concerned about Crypto because it can disrupt financial stability and monetary policy. ”
Supreme Court gave this instruction
The Supreme Court had directed the Center last month to formulate a ‘clear’ policy to regulate cryptocurrency. The court also underlined its impact on the economy. A bench of the Supreme Court called the bitcoin trade as an illegal trade just like a ‘hawala’ business. India is currently working on a discussion letter for cryptocurrency and an inter-ministerial group (IMG) is looking at the global norms. This inter-ministerial group includes RBI, Market Regulatory Securities and Exchange Board of India (SEBI) and Finance Ministry officials. Cryptocurrency is not yet illegal in India due to no law regarding this.
Taxing does not mean valid
This ‘discussion letter’ will give an opportunity to the stakeholders to present their views before setting a policy stance on India’s cryptocurrency. The government announced a tax of 30 percent on the benefits from cryptocurrency in 2022. Taxing the income from cryptocurrency does not make it valid. Curpto properties are currently not within the scope of rules in India. Rather, it is being noted with the perspective of anti -money purification law. In addition, in such digital properties, income tax and TDS (tax deduction at source) are levied on income from trading. Also, the Goods and Services Tax (GST) is also applicable on the cryptocurrency business. Significantly, on March 4, 2021, the Supreme Court canceled a circular of RBI on April 6, 2018. Through this circular, banks and RBI were banned to provide virtual currency services on regulated institutions.
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