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Indian Finance Minister Nirmala Sitharaman spoke about the need for regulations on cryptocurrencies globally, citing the use of these digital tokens in money laundering and terror funding.
"I think the biggest risk for all countries across the board will be the money laundering aspect and also the aspect of currency being used for financing terror," said our FM in Washington at a discussion hosted by the International Monetary Fund (IMF).
Currently, cryptocurrencies are not regulated by any entity. The lack of regulations is one of the main selling points of cryptocurrencies. They operate using a technology called Blockchain and are stored not on a cloud or a server, they are stored on a network of computers and cannot be tampered with easily. All transactions in crypto markets are stored on this network of computers in Ledgers.
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However, the lack of any controlling authority is what concerns governments all across the globe since these funds can be easily traded and used for illegal activities without leaving any paper trail.
"I think regulation using technology is the only answer. Regulation using technology will have to be so adept, that it has to be not behind the curve, but be sure that it is on the top of it. And that's not possible if any one country thinks that it can handle it. It has to be across the board," Sitharaman said.
Moreover, our FM added that a tax of 30% on gains in cryptocurrencies was levied in India in order to keep track of the entities engaging in said transactions.
She stressed the fact that a single country will not be able to fully regulate cryptocurrencies and global cooperation was necessary to ensure there is no money laundering or terror funding using these digital assets.
Article by Aman Agarwal.
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