- Indian Member of Parliament Raghav Chadha has introduced a tokenization bill that also proposes regulations, protections for investors, and mechanisms to resolve conflicts.
- The bill is unlikely to pass as MP Chadha is a member of the opposition. Further, private member bills in India rarely pass due to bureaucratic hurdles and political reasons.
- If passed, the bill would have set a golden standard for positive crypto regulations in the country.
- Current Indian laws on crypto are hostile to digital assets, with a flat 30% tax and a 1% tax deducted at source.
- India is the 4th-largest economy in the world by GDP and the 3rd-largest by GDP PPP.
MP Presents Private Member Bill in Rajya Sabha on Asset Tokenization
Rajya Sabha Member of Parliament (MP) Raghav Chadha, who also happens to be a Chartered Accountant, brings a historic asset tokenization bill, which was intended to help India in the journey towards the digitization of tradfi assets such as stocks, bonds, real estate, businesses, and alternative investments.
Why is it Historic?
Indian crypto regulations are currently punitive, and the country not only misses out on wealth unlocking with blockchain technology but also misses out on up to half a billion in taxation. The punitive tax that is currently in place rather encourages black market trading of cryptocurrencies than regulates it.
The bill, if passed, would have presented a clear standard for a transition to transparent Web3 infrastructure.
Why is it Unlikely to Pass?
Indian administration and bureaucracy have been seeing blockchain technology in a positive light. However, the same is not true for cryptocurrencies, which is just other side of the same coin.
Cryptocurrencies have always been seen by the government as a means to launder money for illicit activities, which is, coincidentally, is also true for fiat money.
The Prime Minister, who is the head of the government, presses for blockchain technology, whereas the Finance Ministry and bureaucracy have been opposing it, creating a clear state of miscommunication for crypto projects in the country.
The tweet below from state broadcaster AIR shows the PM’s push towards blockchain.
Disclaimer: BFM Times acts as a source of information for knowledge purposes and does not claim to be a financial advisor. Kindly consult your financial advisor before investing.
