Thread by @CryptooIndia

🚨 BREAKING: 🇮🇳 Indian Parliament’s Home Affairs Committee calls for crypto regulation instead of a ban!

In its 254th Report on Cybercrime, it flags serious risks from scams & laundering, but recommends regulating crypto as digital assets under FEMA.

A full breakdown 🧵👇

1⃣ The report notes that crypto is misused across multiple crimes:

🔸 Cryptojacking (devices hijacked to mine coins)

🔸 Ponzi apps & trading scams

🔸 Ransomware paid in Bitcoin

🔸 Dark Web use for drugs, arms, child exploitation

🔸 Human trafficking & fake job scams using crypto

2⃣ The MHA & CBI flagged crypto in cross-border laundering:

🔸 Mule accounts + crypto wallets

🔸 Layering through P2P transfers, shell firms & gold purchases

🔸 Dark Web payments

🔸 Crypto with underground banking supports global criminal groups

3⃣ Other risks flagged:

🔸 “Digital arrest” scams extorting victims into sending crypto

🔸 Youth trafficked into overseas scam factories running crypto frauds

🔸 Crypto + Dark Web seen as drivers of global cybercrime ecosystems

4⃣ Victims are hit hard:

🔸 53.9 lakh complaints on the National Cybercrime Reporting Portal

🔸 ₹31,594 crore reported fraud losses (2019–2024)

🔸 85% of all cybercrime complaints are financial frauds

🔸 Ponzi apps & “get-rich-quick” crypto schemes trap ordinary citizens

5⃣ So far, the narrative is strongly negative. BUT the Committee didn’t call for a ban.

✅ Instead, it recommended:

🔸 Classifying crypto as “digital assets” under FEMA (Foreign Exchange Management Act)

🔸 Bringing exchanges under AML/KYC & FATF rules

🔸 Creating a uniform legal definition of crypto for tax & regulation

6⃣ The report also flagged stablecoins:

🔸 Could be useful in remittances & settlements

🔸 But carry risks if unchecked

🔸 Suggested careful RBI oversight before INR-linked stablecoins are allowed

7/ On investor protection:

🔸 Warned of retail scams & frauds in crypto

🔸 Urged licensing & regulation of exchanges

🔸 Called for clear taxation policy (current 30% tax + 1% TDS seen as unclear without a proper definition)

8⃣ Future-proofing:

🔸 The report recognizes the coming threat of quantum computing breaking today’s encryption.

🔸 It calls for development of Post-Quantum Cryptography (PQC) to secure digital assets & payments.

9⃣ Key takeaway:

🔸 The report paints crypto mostly as a risk factor in crime, fraud & laundering.

🔸 But it doesn’t push for a ban.

🔸 Instead, it calls for strict regulation under FEMA, AML/KYC, stablecoin oversight & quantum-resistant safeguards.

🇮🇳 Bottomline: India is moving towards a regulate, not ban approach.

Crypto will likely be treated as a digital asset, not legal tender.

This report is a big step in shaping that narrative.

#Crypto #Bitcoin #India

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