Since the emergence of cryptocurrencies as the new era of digital trading. Governments around the world have been putting necessary measures in place to regulate the industry, especially against fraudsters. As we can see in the Euro and some Asian countries.
To follow this step, the Indian government has announced today that all crypto businesses in the country would come under the ambit of the anti-money laundering law – PMLA. The move comes to ensure all crypto businesses are probably monitored and regulated.
Previously, Indian governments showed a stern position on cryptocurrencies in February this year by outright forbidding cryptocurrency sponsorships and advertising in the neighborhood women’s cricket league. This came after a prior prohibition for the men’s cricket Premier League, which was put in place back in 2022.
Additionally, Nirmala Sitharaman, India’s finance minister, recently called for international action to control cryptocurrencies as her country celebrated its first G20 presidency. She urged a concerted effort to be made to develop and comprehend the macro-financial consequences that may be used to change crypto policy around the world.
Regulating Crypto Businesses in India
A notification from the Ministry of Finance was issued in The Gazette of India on March 7 and subjected several cryptocurrency businesses, including the administration, exchange, and transfers of virtual assets, to the Prevention of Money-Laundering Act (PLMA) 2002. The PMLA also applies to financial services connected to an issuer’s offer and sale of virtual assets.
There aren’t many details in the announcement, but the PML Act requires financial institutions to keep a record of all transactions for the previous 10 years, submit this information to officials upon request, and confirm the identity of every client.
The notification, while timely as regulators around the world tighten the AML criteria for cryptocurrency, would nonetheless make it more difficult for crypto businesses to operate in India. And it already has not been too comfortable in recent years.