India Moves Towards Regulated Crypto Oversight with SRO Recommendations

India's Parliamentary Standing Committee on Finance has recommended an interim regulatory framework for cryptocurrencies through Self-Regulatory Organizations (SROs) while the government works on a comprehensive crypto law.

The committee suggested allowing industry-led SROs to oversee the sector under the supervision of a designated regulator such as SEBI or the RBI, instead of immediately bringing cryptocurrencies under the proposed securities law.

Clear legal definitions for Virtual Digital Assets (VDAs) are also needed in India, according to the report. Some digital assets may qualify as securities, others as derivatives, while some require a separate regulatory category.

The committee studied regulatory approaches in several countries, including the UK, Singapore, the US, and the European Union, before concluding that India should adopt a phased regulatory framework instead of waiting for a comprehensive law.