India's emergence as a global power, the influence it wields at the moment, is a testament to its diplomatic and economic prowess, and unwavering commitment to global prosperity and domestic progress. The G20 presidency has come to India at a time when the world is deliberating the next best course of joint action for virtual digital assets. This places a monumentary opportunity for India to make its mark in the space of emerging technology, by creating the first-ever collaborative framework for regulating crypto assets in collaboration with the International Monetary Fund (IMF) and the Financial Stability Board (FSB).
Global policy has been a complex domain but India has ensured that over the years, it is not just heard, but also listened to. It has fulfilled many aspirations of its millions of citizens and established its mark in the world with vaccine diplomacy, economic growth, bilateral relations and the most recent feather on the cap, making its presence on the lunar south pole. The chance of shaping a policy for the most talked about technology in the world at the moment couldn’t have come under better circumstances.
India has also been able to place the spotlight on the Global South and made the priorities crystal clear for their comprehensive enrichment. India’s actions towards domains such as resource sustainability, clean energy, and combating climate change have sharpened its agenda, ensuring complete clarity on creating a better future for its citizens, as well as other stakeholders involved. This time was no different. India took a bold stance during the third G20 Finance Ministers and Central Bank Governors meeting in Gandhinagar, Gujarat, emphasis was on developing a single framework for regulating crypto assets considering their borderless nature.
India has envisioned how beyond the realm of domestic law enforcement, there needs to be regulators to watch over illicit activities that transcend borders and make it difficult for authorities to scrutinise in case of security breaches or complaints from users. Keeping user safety at the core, India has released three fundamental principles which are — overseeing macroeconomic and financial stability risks, protecting investors, and retaining technological innovation while guaranteeing effective regulation.
Being one of the largest democracies in the world, India faces challenges which are unique in nature. However, the demand for crypto in the country is as robust as it has been across the world with rapid adoption, homegrown projects in the space, and a growing bunch of talent. Besides that, advocacy from entrepreneurs, dialogues with different thought leaders, and the openness of regulators to understand this growing space and embrace it as a part of the existing areas to govern, have been helpful for its domestic ecosystem.
India also perceives it imperative to make crypto independent from macroeconomic factors as well as mainstream finance barring certain circumstances. This is mainly due to user protection and reduction of risks which is aligned with the concerns of many other countries on the brink of regulating digital assets.
Crypto regulations have been a clarion call for nations for the last two years. The Synthesis Paper by the FSB and IMF has definitely been a guiding light for regulators to take into account certain aspects of traditional finance that could impact virtual digital assets and vice versa.
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Interestingly, both G20 and the Bitcoin White Paper were created as responses to financial crises that affected the world severely. To witness the intermingling of the two in a way where the former aspires to create a sweet operational spot for the latter to thrive in, and for billions of people to experience its benefits, is quite remarkable. It is a historical moment and the fact that this chance has landed on the Indian subcontinent is something that will etch its role as one of the primary trailblazers of crypto regulation.
India has been a promising agent of positive change and development, building alliances in the global arena that can benefit all stakeholders uniformly. It is certain that the policy framework that is in the works by India in collaboration with other nations, will ensure that everyone shares the benefits and no one is left behind while we continue to embrace remarkable changes in finance, technology, environment, etc.
(The author is the Vice President of crypto investment platform WazirX)
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