Ministry of Finance, which released a notification on March 07, 2023, has decided to move cryptocurrencies under anti-money laundering regulations. Experts believe that this step aims to enhance regulatory proceedings over digital assets based on global standards.
“By bringing crypto businesses under the ambit of PMLA, Indian government aims to take measures to ensure that the industry can operate in a regulated environment. This can not only promote transparency but also aid in identifying and curbing the activities of bad actors within the industry,” Punit Agarwal, founder, KoinX, a cryptocurrency taxation platform, told FE Blockchain.
Insights from Ministry of Finance’s gazette notification stated that crypto trading, safekeeping, and associated financial services will be subjected to anti-money laundering practices. “Exchange between virtual digital assets and fiat
According to Edul Patel, co-founder and CEO, Mudrex, a crypto-investing platform, incorporation of cryptocurrencies into PMLA can enable creation of an Indian digital assets ecosystem. “Implementing protocols for exchanges and associated entities can now enable vigilance to prevent money laundering and other illegitimate undertakings associated with cryptocurrencies. Such a move aims to fortify the financial system’s integrity and can instill trust in potential investors toward the crypto industry,” Patel added.
Moreover, the notification highlighted that “virtual digital asset” will carry the same definition that’s been allocated to it in clause (47A) of Income-tax Act, 1961.