India Parliamentary Panel Suggests Interim Crypto Regulatory Framework via SRO-Led Mechanism

A parliamentary panel in India has called for regulatory clarity on cryptocurrencies and Virtual Digital Assets (VDAs), recommending an interim framework led by Self-Regulatory Organisations (SROs) under designated regulator oversight.

The committee's 36th report on the proposed Securities Markets Code, 2025, was presented to Parliament on July 23. It highlighted the need for a comprehensive legislative framework to address the regulatory gap in the sector.

VDAs currently lack a dedicated legal framework in India and are regulated only for limited purposes such as taxation, prevention of money laundering, and reporting requirements.

The panel suggested that an interim mechanism could be introduced through recognised SROs operating under the oversight of the designated regulator. This would help address risks arising from the existing regulatory gap while promoting market discipline and protecting investor interests.