Supreme Court Urges Government Action on Crypto
India‘s Supreme Court has issued a strong call for the government to step up and establish clear regulations for the cryptocurrency market, highlighting growing concerns about the unregulated space. This move comes after the court observed the government’s imposition of taxes on digital assets like Bitcoin, despite the lack of a comprehensive regulatory framework.
During a recent hearing related to an ongoing investigation into a Bitcoin transaction, Justice Surya Kant, a judge on the Supreme Court, expressed deep concern over the burgeoning cryptocurrency economy operating without proper oversight. “This is a whole parallel economy running with such coins and is a danger to the economy of the country,” Justice Kant stated.
Taxation Without Regulation: A Paradox?
The court specifically highlighted the irony of the government levying a 30% tax on cryptocurrency gains while failing to provide a regulatory framework. “If you can tax it at 30%, also please regulate it as you have recognised it by taxing it,” Justice Kant emphasized, urging the government to address this inconsistency.
The government, represented by the Additional Solicitor General of India, responded by stating that “the government will take instructions, my lord,” indicating a potential shift towards reviewing the country’s current crypto regulatory landscape.
Concerns About Misuse and Counterfeiting
Justice Kant also expressed concerns about the potential for misuse of cryptocurrencies, particularly regarding the lack of clear rules to prevent illegal activities. “There is some system of rules that applies to this,” he remarked, suggesting the need for robust mechanisms to ensure responsible usage and prevent illicit transactions.
The judge further raised the question of counterfeit cryptocurrencies, though it remains unclear whether this was intended to suggest the existence of fraudulent Bitcoin or the possibility of illicit activities within the broader crypto space. “Some Bitcoins are genuine, but some might not be. It has also become a possible way to do illegal business,” he said, emphasizing the potential for crypto to be used for criminal purposes.
Growing Calls for Regulation
This latest development adds fuel to the ongoing debate about the need for clear crypto regulations in India. While the government has been slow to introduce comprehensive legislation, the industry’s continued growth and the increasing use of cryptocurrencies have prompted calls for action from both industry players and policymakers.
The Supreme Court‘s intervention underscores the urgency of establishing a regulatory framework to provide stability and clarity for the crypto market while mitigating potential risks. The government’s response and the steps it takes to address the concerns raised by the court will be closely watched by both the crypto community and the broader financial sector in India.
