• The Indian Finance Ministry’s Economic Survey 2022-23 presented in Parliament Tuesday highlighted the necessity for a common approach to regulating the crypto ecosystem.
• Crypto assets are self-referential instruments and do not pass the test of being a financial asset because they have no intrinsic cashflows attached to them.
• The U.S. Securities and Exchange Commission has disqualified bitcoin, ether, and various other crypto assets as securities.
The Indian Finance Ministry’s Economic Survey 2022-23 highlighted the importance of regulating the crypto ecosystem in India. The survey, which was presented in Parliament Tuesday by Finance Minister Nirmala Sitharaman, is an annual flagship document of the Ministry of Finance that outlines the performance of the Indian economy in the previous financial year and presents an economic outlook for the current financial year. This is the first time that cryptocurrency has been included in the Economic Survey.
The survey highlighted the necessity for “a common approach to regulating the crypto ecosystem” in India. The document explains that “crypto assets are self-referential instruments and do not strictly pass the test of being a financial asset because it has no intrinsic cashflows attached to them.” This echoes the warnings of the Reserve Bank of India (RBI), which has repeatedly stated that cryptocurrency has no intrinsic value and poses a risk to the country’s financial stability.
The survey also noted that U.S. regulators have disqualified bitcoin, ether, and various other crypto assets as securities. The U.S. Securities and Exchange Commission (SEC) has been cracking down on fraudulent activities in the crypto industry, including the recent collapse of the crypto exchange FTX.
The Indian government is now taking steps to regulate the crypto ecosystem in the country. The RBI has proposed a ban on cryptocurrencies such as bitcoin and ether, and the government is currently working on a bill that would regulate the crypto industry.
The inclusion of cryptocurrency in the Economic Survey is a sign that the Indian government is taking the issue seriously. With the increasing popularity of cryptocurrencies, it is clear that the government needs to take a common approach to regulating the crypto ecosystem. This could help protect investors from fraud, money laundering, and other risks associated with the crypto industry.