What Is the Crypto Bill All About? CoinSwitch Compliance Officer Explains

Ever since news got out that the government is planning to introduce a new cryptocurrency bill during the winter session, there's been a lot of misinformation floating around. This led to a lot of panic selling initially, but things seem to have cooled off a bit. However, a lot of cryptocurrency traders and investors in India are worried about the future of crypto in the country.

To make things simpler, CoinSwitch recently held some highly useful sessions on YouTube. The goal of these videos is to spread knowledge, and help people understand the current status of the proposed cryptocurrency bill in India. This will help everyone make informed trading and investment decisions when it comes to cryptocurrencies.

Sundara Rajan, the chief compliance officer at CoinSwitch, talked about the proposed crypto bill, and other details around regulation that would be useful for cryptocurrency investors and traders in India. Below, we'll explain some of the key details that were shared during the live YouTube session.

Are we past the 'crypto will be banned' narrative?
One of the biggest questions on everyone's mind right now is - will India really ban crypto? To put an end to rumours, Rajan said we can safely say that India will not ban crypto entirely. He talked about the recent developments and official statements that have been released both publicly and internally with stakeholders. The government is mainly concerned about the misuse of crypto, and wants to avoid that. Apart from that, the government seems to be looking at ways to regulate crypto.

Crypto taxation amid the news
To clarify a key question on crypto taxation in India, Rajan referred to a recent statement by revenue secretary Tarun Bajaj where he discussed how people should be paying taxes on capital gains based on their cryptocurrency profits. Tax laws can also be changed to introduce TDS on crypto capital gains. If the government is planning to introduce these taxes, it means they'll allow buying and selling of cryptocurrencies.

What about people reading between the lines of the bill description?
We don't really know much about the proposed cryptocurrency bill apart from the main headline. But people are still trying to make assumptions out of whatever is being made public or discussed online, leading to a lot of panic. To make things clear, Rajan said that no one currently knows about the content of this propose crypto bill.

Everything is still a part of speculations, he further added. The crypto market in India crashed initially because of a lot of panic selling due to unverified news. A lot of crypto investors in India lost a good chunk of their money due to this, Rajan added. He also said that these speculations should end until we have some verified news and details about the proposed bill.

Rajan also said that CoinSwitch believes that this proposed bill on cryptocurrencies will bring some sort of positive development for the industry. It doesn't look like the government will ban crypto entirely. We don't know what the bill itself contains as of now, but we're hoping the bill will be positive and our business is going on as usual. We're not changing anything based on these ongoing speculations.

How can money laundering be curbed in crypto?
Sceptics believe that crypto is the breeding ground for money laundering. One of the key issues for the government itself is whether crypto will lead to a rise in money laundering cases across the country. To explain things, Rajan answered by saying money laundering has happened across various channels, and continues to take place. But you cannot close an asset class just because it can be misused. Some people may use crypto to launder money, and we have to figure out a way to prevent that from happening. However, money laundering can happen across a wide range of assets. Regulation in crypto may help curb money laundering in the long run.

Rajan further added that strong KYC, monitoring transactions, and avoiding cash transactions are some of the ways to avoid money laundering with crypto. He said it's wrong to say money laundering is happening only with cryptocurrencies. Banning crypto may not be the one-stop solution to this problem.

How should investors react?
A lot of cryptocurrency investors and traders in India are worried about their investments, and they want to know how they should go about their transactions. Rajan is clear about one thing — avoid panic selling. He said everyone should stop making buying or selling decisions based on half-baked news or reports. Once the bill is out, and the government brings regulation to the industry, you can carry on with your investments and trades. Avoid panic buying or selling at all costs, he added.

What makes CoinSwitch's KYC process reliable and safe?
CoinSwitch has a robust KYC process which will be further improved going forward, said Rajan. The company is also actively monitoring transactions to avoid potential scams. Rajan said this will remain an ongoing process, and we will continue to work on it without compromises. This is a win-win for both the company as well as its users.

Rajan ended the live session by further cementing his belief that the government will not introduce a blanket ban on crypto. He said he hopes there will be a positive development in the proposed bill, and it's only a matter of time before we know the actual contents of this bill. As for traders and investors, Rajan warned everyone to avoid panic buying or selling until there's reliable information available.