India’s Ministry of Finance has introduced a provision that extends the Anti-Money Laundering Act to the cryptocurrency sector. The move was the latest in a government tightening of regulation over digital assets.
According to available data, the issuance, storage, sale and other dealings with cryptocurrencies will fall under the Money Laundering Act – all of which will now be monitored much more closely. The source notes that the Indian government introduced stricter tax regulations for the cryptocurrency sector over the past year, including a trade tax. The tightening of supervision in this segment, as well as the global collapse of the cryptocurrency market, led to a sharp decline in the volume of digital asset trading in the country’s domestic market.
India’s attempt to tighten regulation of the cryptocurrency sector is in line with a global trend, as many governments require digital asset platforms to comply with applicable anti-money laundering laws, which are similar to those that apply to banks or stockbrokers. India’s actions are worrying, experts say, as implementing measures to strengthen oversight will take time and certain resources.