India

Indian Companies to Declare Crypto Holdings

It is no longer news that the Indian government has always had an anti-crypto stance. The initial plan to impose a blanket ban on cryptocurrencies has met with some level resistance from cryptocurrency enthusiasts who voiced their displeasure with the hashtag #IndiaWantsBitcoin.

However, despite this, the government appears bent on going forward with its anti-crypto stance. In one of the recent development, India’s Companies Act was recently amended to allow companies in the country to declare their crypto holding in their public financial reports. According to the Ministry of Corporate Affairs (MCA), this rule applies to all Indian-based companies and will take effect from April 1, 2021.

The rule would apply to any company that invested or traded in cryptocurrencies in the financial year under review, mandating them to state their profits or losses on the crypto transactions.

The other information the companies would be required to disclose are: the amount of crypto being held and the advance deposits customers made with the aim of trading or investing in cryptocurrencies.

Uncertainties Prevail Over Crypto Use in India

These disclosures are alleged to be an attempt by the regulators to stop citizens from investing in the Initial public offerings (IPO) in the crypto market.  Some promoters of these IPOs are alleged to have issued affidavits indicating that they will be liquidating all their digital assets if the authorities go ahead with the crypto ban.

In spite of the uncertainties surrounding the use of cryptocurrencies in the Asian country, the Finance Minister and the Governor of the Reserve Bank of India (RBI) hold similar views on crypto. Shaktikanta Das, RBI Governor commented at the Times Network India Economic Conclave. Das said that central bank digital currency and cryptocurrencies are not the same thing. He spoke of the commitment of both the government and the bank’s effort to maintain the financial stability of the country. He said certain concerns about the cryptocurrencies been traded in the Indian market have been flagged to the government.

Several experts have cautioned against a blanket ban on crypto. The Finance Minister alluded to the fact that the citizens should be allowed to experiment with cryptocurrencies.

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