India Hints At Softer Regulatory Stance Toward Bitcoin, Ethereum, Dogecoin — Looks Into Taxing NFTs

In a possible signal toward easing the hostile environment and regulations for cryptocurrencies in India, a top government official said the country was drafting a cryptocurrency consultation paper.

What Happened: Indian Economic Affairs Secretary Ajay Seth told the media that the paper was "fairly ready. We have gone through a deep dive and consulted not just domestic stakeholders but also organizations like the IMF and the World Bank."

"We hope that we will soon be in a position to finalize [it]."

While it is unclear what the regulations hold, Seth said the government is looking for a global consensus on cryptocurrency, reiterating a previous official stance.

Seth added that India "can't succeed unless there is global consensus around that."

NFTs On The Radar: India's Central Board of Direct Taxes (CBDT) is working on guidelines to define how non-fungible tokens or NFTs can be taxed, Business Standard reported, citing unnamed sources.

The government recently imposed a 30% tax in April on cryptocurrencies like Bitcoin BTC/USD, Dogecoin DOGE/USD, and Ethereum ETH/USD.

Why It Matters: Prime Minister Narendra Modi, who is in his eighth year as India's top leader, had called for a "synchronized action" on cryptocurrency at the 2022 World Economic Forum's annual Davos conference.

India has been mulling regulating the use of digital assets in the country for a very long time. The uncertain environment and the regulatory uproar have sent many big-ticket cryptocurrency traders to switch to exchanges overseas. The government has also been accused of putting "informal pressure" on crypto exchanges to drive them out.

Price Action: According to data from Benzinga Pro, Bitcoin was trading at $31,721, gaining 4.44% in the last 24 hours. At the same time, Ethereum and Dogecoin were trading up 5.7% and 3.2%, respectively.