India is hesitant to create comprehensive crypto regulations, fearing that doing so could expose the financial system to systemic risks.
India has no plans to regulate the crypto sector for now, citing concerns that it could expose the country’s financial system to risks.
A recent report by Reuters, based on a government document, reveals that officials are concerned that legitimizing crypto may make it systemic and harder to manage.
The report explains that containing crypto-related risks through regulation would be challenging. While a complete ban could tackle speculative activities, it wouldn’t prevent peer-to-peer transfers or decentralized trading.
As a result, the government prefers partial oversight, keeping crypto’s use limited within existing tax and anti-money laundering frameworks.
Indians currently hold $4.5 billion in crypto and constantly look for the next crypto to explode. According to officials, this figure is neither significant nor a systemic risk to financial stability.
India’s Cautious Stance
Despite rising global crypto adoption, the Indian government remains cautious. Previous efforts, such as the 2021 draft bill to ban private cryptocurrencies, were shelved, and discussions around crypto regulation were postponed last year.
Earlier this year, the Reserve Bank of India (RBI) fined P2P platforms like Faircent, Finzy, Visionary Financepeer, and Rang De for violating lending guidelines, totaling over ₹75 lakh.
Currently, global crypto exchanges can register in India after compliance checks but remain excluded from mainstream financial channels.
As per the document, the government finds the current limited regulations, backed by taxes and fraud penalties, sufficient to deter speculative risks.
Neighbours Move Toward Crypto Adoption
Unlike India, several Asian governments are actively supporting crypto adoption and aiming clear regulations for the sector.
Singapore remains a strong player in the region, with its Payment Services Act offering a clear framework for digital tokens.
Pakistan has welcomed digital assets by creating a national Bitcoin BTC $114 999 24h volatility: 2.8% Market cap: $2.30 T Vol. 24h: $61.94 B reserve, with Michael Saylor offering advisory support.
It has also moved forward to allocate 2,000 megawatts of surplus electricity for mining and AI data centers.
Kazakhstan is also working on a crypto reserve fund to boost its economy and integrate blockchain into its National Fund.
Meanwhile, Thailand is using cryptocurrencies to boost its tourism sector. The government recently launched the “TouristDigiPay” initiative that allows visitors to convert cryptocurrencies into Baht for daily transactions.
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