Idea of Tech-Driven Regulatory Framework Under G20 Receives Mixed Reactions  

A day after Indian Finance Minister Nirmala Sitharaman spoke about her plans to work towards a tech-driven regulatory framework for cryptocurrencies under the aegis of G20, industry leaders offered mixed reactions to her statements.    

Sitharaman spoke about crypto regulations to reporters on the sidelines of the fall meetings at IMF, World Bank, and G20 Finance Ministers and Central Bank Governor (FMCBG) in Washington last week, media reports said. 

Positive but Contradictory 

India Blockchain Forum’s Co-founder Sharat Chandra said Sitharaman’s statement that technology should not suffer to uphold regulation has “sent a positive message to builders and entrepreneurs in the crypto-tech space. It’s a significant development for the digital asset and fintech industry,” India’s Outlook reported. 

Singapore-based Wen 3 venture capital firm Reflexical Pte’s founder Ajeet Khurana said the Indian finance minister’s stance of supporting the technology but not the underlying economics is contradictory. 

“Even if it is a tech-driven regulatory framework, sooner or later, all governments will have to take an unequivocal stance on digital assets,” – Khurana explained. 

Web3 analytics firm GoSats’ CEO Mohammed Roshan noted that tech-driven crypto regulation looks to be a close possibility now. 

“With the crypto industry and its stakeholders desperate in search of clarity in terms of regulations, an overarching tech-driven legal framework for the country definitely looks to be on the cards sooner than later,” – Roshan said. 

Contradictory Stance

The Indian Finance Minister has praised blockchain technology on several occasions but has also expressed reservations about its anonymity feature and how cryptocurrencies can lead to illegal activities and financial instability.

“We don’t want the technology to be disturbed. We want the technology to survive, and also be in a position for the FinTech and other sectors to benefit from it,” 0 she said in Washington.

In an example of how blockchain is being used to make life and systems better, the Indian district police of Firozabad recently launched such an online complaint registration portal to ensure the manipulation-free filing of complaints by victims of crime. 

But her usual skepticism about cryptocurrencies was also evident during her Washington trip. 

“But if it is a question of platforms, i.e., trading on assets which have been created, and for buying and selling, and making profits, are we in a position to establish for what purpose it’s being used? Are all the countries in a position to understand the money trade?” – she commented.

G20 Presidency and Crypto 

India will hold the G20 Presidency from December 1, 2022, to November 30, 2023. The Group of Twenty comprises 19 countries and the European Union and works on cooperation and governance issues of the international economy. 

“We would definitely want to collate all this and do a bit of study and then bring it on to the table of the G20 so that members can discuss it, and hopefully arrive at a framework or SOP so that globally, countries can have a technology-driven regulatory framework,” – she said to the reporters.