Indian Government Launching Crypto Awareness Campaign
The government of India is launching a crypto awareness campaign that will educate investors about the legality of cryptocurrencies in the country while highlighting the risks of investing in crypto assets.
Indian Government’s Cryptocurrency Awareness Campaign
The Indian government is reportedly launching a first-of-its-kind crypto awareness campaign. It will be conducted by the Investor Protection and Education Fund Authority, a government body controlled by the Ministry of Corporate Affairs.
A government official was quoted by ET as saying:
The campaign will highlight that cryptocurrencies are not legal in India and there are also deep risks involved in such assets. Any investment where the people are being promised lucrative and assured returns, there is an element of high risk.
The government of India has been working on a crypto policy since 2019 but nothing has been finalized. Indian Finance Minister Nirmala Sitharaman said the government plans to discuss crypto regulations with the G20 members.
The Indian central bank, the Reserve Bank of India (RBI), has long recommended a complete ban on all cryptocurrencies like bitcoin and ether, warning of their potential to destabilize the country’s monetary and fiscal stability. RBI Governor Shaktikanta Das recently said the next financial crisis will come from cryptocurrencies if they are not prohibited. However, Sitharaman said both banning and regulating require international collaboration to be effective.
Rajagopal Menon, vice president at Indian crypto exchange Wazirx, told The Hindu:
Cryptocurrency investing can be a complex and risky endeavor as the category is extremely volatile and works round the clock. It is important for potential investors to thoroughly educate themselves before making any decision.
However, some are concerned that the Indian government’s crypto campaign may paint cryptocurrencies in poor light, given that the Investor Protection and Education Fund Authority has conducted awareness campaigns on Ponzi schemes, chit funds, and dubious crowdfunding projects.
Vipul Kharbanda, a non-resident fellow at the Centre for Internet and Society (CIS), was quoted as saying:
If the government takes a heavy-handed approach and starts saying things like virtual currency is not legal in India, that will not be entirely true. People may presume incorrectly that it is illegal.
Both the Indian government and the central bank have said that cryptocurrency is not illegal in India.
Despite having no regulatory framework for cryptocurrency, the Indian government is taxing crypto income at 30% and has imposed a 1% tax deducted at source (TDS) on crypto transactions.