The Indian government is starting a crypto awareness campaign to educate investors on the legality of cryptocurrencies in the country while emphasizing the hazards of investing in crypto assets.
Cryptocurrency Awareness Campaign by the Indian Government
The Indian government is apparently starting a first-of-its-kind crypto awareness campaign. It will be run by the Investor Protection and Education Fund Authority, a government organization overseen by the Ministry of Corporate Affairs.
A government official was quoted by ET as saying:
The campaign will highlight that cryptocurrencies are not legal in India and there are also deep risks involved in such assets. Any investment where the people are being promised lucrative and assured returns, there is an element of high risk.
Since 2019, the Indian government has been working on a crypto policy, but nothing has been approved. Nirmala Sitharaman, India’s Finance Minister, stated that the government intends to address crypto legislation with G20 countries.
The Reserve Bank of India (RBI) has long advocated for a total ban on all cryptocurrencies such as bitcoin and ether, citing their potential to undermine the country’s monetary and fiscal stability. The next financial catastrophe, according to RBI Governor Shaktikanta Das, would be caused by cryptocurrencies if they are not outlawed. However, Sitharaman stated that both prohibition and regulation require international cooperation to be effective.
According to Rajagopal Menon, vice president of the Indian crypto exchange Wazirx,
“Cryptocurrency investing can be a complex and risky endeavor as the category is extremely volatile and works round the clock. It is important for potential investors to thoroughly educate themselves before making any decision.”
Some are afraid that the Indian government’s crypto campaign may present cryptocurrencies in a negative light, considering that the Investor Protection and Education Fund Authority has run awareness campaigns on Ponzi scams, chit funds, and questionable crowdfunding initiatives.
According to Vipul Kharbanda, a non-resident fellow at the Centre for Internet and Society (CIS):
“If the government takes a heavy-handed approach and starts saying things like virtual currency is not legal in India, that will not be entirely true. People may presume incorrectly that it is illegal.”
The Indian government and the central bank have both stated that bitcoin is not illegal in the country.
Despite the lack of a legal framework for cryptocurrencies, the Indian government taxes cryptocurrency revenue at 30% and imposes a 1% tax deducted at source (TDS) on bitcoin transactions.