India's Crypto Transactions May Face Stricter Monitoring

A parliamentary panel in India may recommend stricter monitoring of cryptocurrency transactions and wider consultations on their legal treatment. The Parliamentary Standing Committee on Finance has been examining various aspects of Virtual Digital Assets (VDAs) for over a year, holding more than half a dozen meetings to prepare a report.

The committee's possible recommendations include greater use of technology to monitor digital asset transactions and wider consultations on how VDAs should be treated legally. This comes as the government continues to assess issues surrounding these assets, including the need for international cooperation to prevent regulatory arbitrage.

The Finance Ministry has previously warned that crypto products are unregulated and can be highly risky, with limited recourse for losses. However, VDA service providers are covered under the anti-money laundering framework, and 15 such providers have recently received notices for non-compliance with the Prevention of Money Laundering Act (PMLA).