The federal government notified that cryptocurrency trade would be subject to India’s anti-money laundering regulations. The government announced that the Prevention of Money Laundering Act, 2002, will henceforth apply to bitcoin transactions and virtual assets.
The notification stated that money laundering rules would apply to the trade of virtual digital assets and fiat currencies, exchanging one or more types of virtual digital assets, and transferring virtual digital assets.
The notification further stated that involvement in financial services relating to the offer and sale of virtual digital assets and the administration or custody of those assets would be included.
Even though the nation’s central bank has often advised against using cryptocurrencies, India still needs to finalize any laws or regulations in this area.
The Finance Ministry announced in a gazette notice that the anti-money laundering laws have been applied to cryptocurrency trading, storage, and related financial activities. Financial Intelligence Unit India will need to be notified of any questionable behavior by cryptocurrency exchanges.
According to the Reserve Bank of India, cryptocurrencies should be outlawed since they are similar to Ponzi schemes.
By including cryptocurrencies in India’s money laundering regulations, officials will have more power to keep an eye on the movement of these assets outside of the nation.
As part of its G-20 leadership, the Narendra Modi administration has pushed for a more comprehensive international agreement to address the hazards of cryptocurrencies.
