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Source: Business Insider India
March 24, 2022
India’s crypto regulations don’t recognize the full scope of web3, say experts
Despite being in the works for over two years, India’s crypto regulations are barely scratching the surface for what the third generation of the Internet, or web3, will need. According to experts, India’s regulators should follow global examples set by countries like the US and the European Union (EU); to effectively regulate cryptocurrencies and web3 projects in the country.
Ajeet Khurana, a noted crypto advisor, believes that three main ways have been explored globally. At a Twitter Spaces conversation held by Business Insider India, Khurana said that coming up with an overarching crypto bill may not be the only route the country can take. He also noted that India has already followed examples set by countries like the US, Australia, UK, Canada, and Singapore, which has tweaked existing regulations to accommodate cryptocurrencies.
At the Union Budget 2022 last month, finance minister Nirmala Sitharaman brought crypto trading under the ambit of existing taxation rules in India instead of announcing a full-fledged crypto bill, which has been in the works for the past year or so.
The need to recognise the potential of web 3.0
Aritra Sarkhel, Director of Public Policy at WazirX, leading crypto exchange in the country, added that different government departments are still unclear on how they will deal with the industry. He noted that various government departments have different versions, and the conversation has moved from being about crypto only to non-fungible tokens (NFTs). However, lawmakers seem to have failed to recognize the complete scope that web3 has.
According to Tamar Menteshashvili – who leads ecosystem growth at Solana Labs, which runs the Solana platform – many web3 company founders from India have been moving to Dubai recently, which is a “strong signal” that “something is not going as well as it should be”.
India is one of the fastest-growing internet consumer markets and has one of the most flourishing pools of start-ups and developers across the world. Web 3.0 is the next internet revolution and has been gaining ground steadily. In fact, a report from the US India Strategic Partnership Forum (USISPF) and Cross Tower stated that Web 3.0 and digital assets could add $1.1 trillion to India’s GDP over the next decade.
Sarkhel said that the industry needs clarity around regulations so that 18-19-year-old founders don’t get confused and move out of the country to avoid future repercussions. “Basically, you don’t want another brain drain to happen. Let’s build together,” he told Business Insider during the Twitter Spaces session.