India’s crypto industry is finally seeing lawmakers get involved

On Saturday, India’s crypto industry pulled off a near-coup by bringing lawmakers and members of India’s ruling party to a conference discussing Web3.

Indian stock exchange CoinDCX, backed by the industry’s policy body, Bharat Web3, and media outlet Forbes brought lawmakers to an event titled “Namaste Web3” at one of New Delhi’s five-star luxury hotels, to discuss India’s G-20 presidency and potential opportunities for India in the Web3 sector.

The conference managed to bring senior leaders from India’s ruling party – National Vice President Baijayant Panda and former Law Minister Ravi Shankar Prasad to an event. From the opposition benches it brought a chairman of the parliamentary standing committee on trade and a deputy chairman of the lower house of parliament.

While lawmakers and government officials have privately held extensive consultations with the industry, this was a rare occasion where they publicly appeared to give the space a new legitimacy.

“Web3 is important with a caution… come out of the shadow of crypto,” said Prasad, who has also been a former information technology minister.

“I’m a big fan of blockchain. But crypto is a whole different ball game. Let me be very clear about that. Because in crypto, it’s about financial sovereignty in India,” Prasad said, while saying that Web 3 needs to find its own ways to disconnect from crypto.

The opposition’s Abhishek Manu Singhvi, who chairs the country’s parliamentary committee on trade, said he was not on stage as the chairman of the parliamentary standing committee on trade, but as a Web3 enthusiast.

“Web 3 could be one of the biggest factors in realizing India’s dream of becoming a $5 trillion economy. Negative focus on cryptocurrency, somewhat obsessive in the previous years, has affected the perception of Web3 and its use. The blockchain narrative needs a paradigm shift from crypto to the transformative changes that can be achieved using Web3, he said.

India’s crypto industry remains heavily stifled by a 30% tax on profits and a 1% tax at source, causing volumes to plummet, and a recent move to bring the industry under India’s anti-money laundering rules.

“A little bit of caution is not unreasonable,” said BJP vice-president Baijayant Panda, who is seen as the ruling party’s technologist.

Panda said Indian policymakers would update rules and regulations based on feedback during a fireside chat about leveraging India’s G-20 presidency to advance the development of regulatory principles for virtual digital assets through international cooperation.

“When it comes to blockchain and bitcoin, this is the forefront of regulatory questions that need to be answered worldwide. You’re starting to see a level of consultation that is more than there was before,” Panda said.

Gaurav Gogoi, an opposition parliamentarian, said the crypto ecosystem has a lot to do to dispel the perception of being used mainly for money laundering and terrorist financing, but he was concerned about the government’s true stance on crypto.

“I hope that our government does not tell others (in the G-20) to put a 1% TDS. It could also be the global consensus or it could be a ban,” he said.