The Confederation of Indian Industries (CII), a non-governmental trade association and legal group, has proposed treating cryptocurrencies as a special class of securities.
The trade association has released a report titled Cryptocurrencies, Crypto Tokens / Assets and Regulation: The Way Forward, in which it calls for regulation of the crypto market, not a ban, Business Line reported. The report highlights important technological innovations that underlying blockchain technology can bring to the payments and remittance sector.
The report suggests developing new rules for the emerging cryptocurrency market rather than being regulated by existing securities legislation.
“A new set of rules should be developed and implemented, appropriate to the context of cryptocurrencies and their decentralized, non-judicial nature. This means that the focus of regulators is on trading and custody rather than issuing (unless the issuance includes an issuer’s first public offering of coins (ICO)). Created in India), ”the official statement says.
The CII report recommends placing cryptocurrencies under a special income tax and goods and services tax clause, under which they can be treated as an asset class for tax purposes, unless they are viewed by the participant as “trading shares”.
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The report recommended that you ensure strict knowledge of your customers and anti-money laundering requirements on centralized exchanges to ensure investor protection. In addition, these exchanges must register with the Securities and Exchange Board of India (SEBI) in order to obtain a financial market broker license. He also recommended setting minimum capital and guarantee requirements for stock exchanges while adhering to disclosure requirements.
The CII report comes at a critical time when a cryptocurrency bill is being debated in parliament. India’s finance minister had previously confirmed that the government would not take a prohibitive approach, but would regulate cryptocurrencies as a resource.