The union government will likely give Indian cryptocurrency holders a deadline in order to declare their assets and to follow the new rules.
A recent cabinet note said that the term 'crypto assets' will be used instead of cryptocurrencies. The Securities and Exchange Board of India will reportedly be asked to oversee and regulate cryptocurrencies to potentially classify it as a financial asset.
A penalty of $2.7 million or imprisonment of 1.5 years will be imposed upon violation of rules as a punishment. The Indian crypto space is the seventh most 'crypto-aware' nation in the world and second in terms of the number of cryptocurrency owners out of 154 countries.
Finance Minister Nirmala Sitharaman said last week the government has reworked an earlier bill, which had proposed banning all private cryptocurrencies to factor in new developments. She added that there was no proposal to recognize Bitcoin as a currency in the country.
