The Indian government has taken another step towards regulating the cryptocurrency industry by introducing new anti-money laundering rules. According to a notice issued by the Finance Ministry on Tuesday, the new legislation will apply to all cryptocurrency-related activities, including trading, safekeeping, and financial services, Bloomberg reports.
This move is in line with the global trend of digital asset platforms being subject to anti-money laundering standards that are similar to those observed by regulated entities such as banks and stockbrokers. Jaideep Reddy from the Trilegal law firm has commented that this is part of the government’s larger plan to put the crypto sector in India under its control.
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The Indian government had already imposed more stringent tax regulations on the crypto industry in 2020, resulting in a significant drop in domestic crypto trading volumes. But the latest move to implement anti-money laundering provisions has raised some worries among industry experts, who are concerned that the necessary compliance measures could take a long time and require a lot of resources. Reddy has highlighted this issue, noting that the Indian crypto sector will have to tackle it in the coming months.
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