India has emerged as a worldwide chief on this ecosystem. It has constantly ranked first on the Chainalysis World Crypto Adoption Index and is residence to one of many world’s largest Web3 developer communities, as highlighted within the Electrical Capital Developer Report 2024.
This sustained momentum presents a well timed and strategic alternative for India to have interaction with a expertise that’s quickly transferring from the margins to the mainstream of the digital financial system.
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Throughout its G20 Presidency in 2023, India performed a pivotal position in constructing international consensus on the necessity for a coordinated regulatory framework for VDAs—an pressing requirement on the time. Since then, most G20 jurisdictions have made vital progress. The European Union’s landmark MiCA framework got here into full power in December 2024, setting a worldwide precedent. Within the U.S., regulatory momentum has picked up, with the Securities and Alternate Fee (SEC) forming a devoted Crypto Process Pressure, and a presidential government order on the Bitcoin Reserve and the U.S. Digital Asset Stockpile pushing the agenda towards concrete legislative motion.
Most just lately, on June 17, the U.S. Senate handed the Guiding and Establishing Nationwide Innovation for U.S. Stablecoins (GENIUS) Act. These developments spotlight the essential position legislatures play in shaping rising tech coverage and display how each legislative and government branches should work collectively to maintain regulatory momentum.In India, nonetheless, a proper discourse on regulating VDAs stays absent. The present framework is proscribed to AML/CFT oversight, a steep taxation regime, and a proposal to gather and trade knowledge on VDA transactions by way of the CARF (Crypto-Asset Reporting Framework).One of many evident gaps in India’s governance structure is Parliament’s restricted engagement with rising applied sciences, significantly VDAs and blockchain improvements. It’s noteworthy that between 2021 and 2025, of the 52,116 questions requested within the Lok Sabha, solely 0.063% have been associated to cryptoassets, cryptocurrency, or VDAs.
Within the Rajya Sabha, this determine stands at 0.08% of the 32,398 questions from 2021–2024. As for debates, the seventeenth Lok Sabha noticed solely three discussions—two by means of Zero Hour speeches and one Particular Point out. The continued 18th session has seen none to this point. In 2021, Parliament did point out its intent to develop a legislative framework on cryptoassets, however that effort didn’t transfer ahead.
Curiously, India introduced plans to launch a Dialogue Paper (DP) on VDAs in July 2024. The DP is a vital first step; nonetheless, almost a 12 months has handed because the announcement, and the paper continues to be awaited. Its well timed launch, coupled with engagement from a proactive and knowledgeable Parliament, shall be key to advancing this imaginative and prescient.
With solely a handful of MPs at present outfitted to navigate the nuances of digital innovation, there’s a urgent must construct institutional capability for knowledgeable legislative engagement.
The Honourable Lok Sabha Speaker just lately underscored the urgency of those points, highlighting the significance of acceptable regulatory techniques, knowledge privateness safety, and equitable tech entry being mentioned throughout nationwide parliaments.
The complexity of VDAs—spanning taxation, monetary markets, safety, privateness, and international compliance—requires sturdy and sustained parliamentary dialogue. Sustaining this momentum would require bettering MP consciousness by means of briefing periods, committee consultations, and cross-party engagement.
India’s bold ‘Viksit Bharat’ imaginative and prescient for 2047 hinges on inclusive development and management in not solely digital public infrastructure but in addition dawn sectors comparable to AI, digital expertise, and—critically—fintech.
As VDAs grow to be an integral a part of this panorama, the forthcoming Dialogue Paper presents a well timed alternative to chart a transparent, forward-looking regulatory path. However turning this chance into motion would require extra than simply coverage intent; it calls for a proactive, knowledgeable, and engaged Parliament.
A powerful legislative basis—grounded in debate and cross-party collaboration—shall be important for India to not solely preserve tempo with international developments but in addition lead in shaping the way forward for digital finance and expertise governance.
(R Venkatesh is Head of Public Coverage at CoinSwitch, Saurya Mishra, LAMP Fellow, PRS Legislative Analysis and Monya is Senior Public Coverage Analyst at CoinSwitch)
(Disclaimer: Suggestions, ideas, views and opinions given by the specialists are their very own. These don’t signify the views of the Financial Occasions)
