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Economics Policy Paper Short Structure
Economics Policy Paper Short Structure
FRAMEWORK
Structure:
I. Introduction
II. Executive Summary
III. Body
1. Types of Cryptocurrencies and Underlying Technologies
2. The Role of Cryptocurrency in the Financial Industry
3. Inherent Risks of Cryptocurrency
4. A Glimpse of the Global Scenario of Cryptocurrency
5. Cryptocurrency’s Journey So Far in India
6. Moving Forward: A Possible Policy Framework for Cryptocurrency in India
IV. Conclusion
A07- RUPIKA T
B18- G SANDEEP KUMAR GOUD
C43- UMMIDI SAI PALLAVI
D35- RITU JAKHMOLA
Cryptocurrency regulatory framework
globally and how India is self-regulating
While most of the top crypto exchanges are self-complaint,
India is currently lagging behind major economies in
terms of regulations.
According to the Blockchain and Crypto Assets Council (BACC), part of the Internet and
Mobile Association of India (IAMAI), India holds about Rs 6 lakh crore in crypto assets
Teena Jain Kaushal
The demand for cryptocurrency in India has been growing at a rapid pace. The growth has
been coming not only from metros but also from small cities and towns. According to the
Blockchain and Crypto Assets Council (BACC), part of the Internet and Mobile Association
of India (IAMAI), India holds about Rs 6 lakh crore in crypto assets. Incidentally, a few of
the leading crypto exchanges have already overtaken Zerodha, which is India's largest
stockbroker, in the number of users. For example, while Zerodha has around 7 million users,
CoinSwitch Kuber and WazirX claim to have a higher user base of 10 million and 9 million
respectively.
"As the popularity of crypto as an asset class investment continues to rise, countries across
the world have been taking steps to ensure a secure ecosystem for users. Crypto exchanges in
India are following self-regulatory practices, very similar to what the other regulated
financial entities follow, to provide comfort and trust to regulators and users. Even though
crypto investing is currently unregulated, we want to be future-ready. Among various other
measures, we use a robust Know Your Client (KYC) process during our user onboarding. To
start trading on our platform, it is required that the name on KYC documents match the bank
account details to validate the user's identity. Only resident Indian bank accounts are
permitted on the platform. We also do a name screening (for Politically Exposed Person
status, sanctioned list, and negative news) when the user is making payment beyond a
threshold level," said Ashish Singhal, Co-chair, BACC, and Founder and CEO, CoinSwitch
Kuber.
Avinash Shekhar, Member of BACC and Co-CEO of ZebPay, said "Many countries such as
Japan, Singapore, the U.K., and the US have implemented regulatory frameworks for crypto
assets to democratise access and protect investors. When it comes to India, we have unique
situations for which our authorities are trying to find solutions. For example, we still have a
large population base that is underbanked or unbanked. We are looking forward to a
regulatory framework that addresses all these issues. Given this situation, self-regulation was
the only option there was and we've been following that from the very beginning. What this
means for ZebPay is following stringent KYC verification and AML compliance policies for
all members who use our platform. This ensures appropriate safety measures are followed
and investor funds are secured."
El Salvador has become the first country to officially declare Bitcoin as the legal currency of
the country. But there has always been a debate whether cryptocurrency should be
considered as an asset class, a currency, a utility or a security. While India is still in the
middle of framing cryptocurrency regulations, let's look at the framework in major economies
that treat cryptocurrency as an asset and not a currency:
United States
The US has the better investor protection laws for the cryptocurrency as an asset class as well
as on tax from capital gains. Just like India, the country has a dual legislative system where
both the Central and the State governments can form regulations.
Some of the states with favourable regulations include Wyoming that in 2019 passed several
blockchain laws recognising crypto assets as digital assets. Moreover, Coinbase, a US-based
exchange is listed in the NASDAQ reflecting the clearer crypto laws of the country.
United Kingdom
In the UK also it has been made clear by the tax authorities that cryptocurrencies can be
considered as a capital asset. The country's tax authority Her Majesty's Revenue and Customs
(HMRC) has said that gains or losses on cryptocurrencies are subject to capital gains tax.
Moreover, exchanges need to be registered with the Financial Conduct Authority (FCA) and
take all measures to protect customers. They also need to comply with anti-money laundering
(AML) and counter-terrorism financing (CTF) initiatives.
Singapore
Singapore has seen an expansion in the crypto market ever since China started a crackdown
on crypto mining. The growth has been on the back of clearer crypto rules in the country
where the Monetary Authority of Singapore (MAS) implemented legislation under its
Payment Services Act. In Singapore for facilitating transmission, exchange or storage of
cryptocurrencies an entity needs to hold a license. Similarly, regulations in the country
provide clearer guidelines with respect to compliance as well as for AML and CTF
initiatives.
RBI governor Shaktikanta Das has once again underlined the concerns around
cryptocurrencies, calling them a threat to any financial system, at least till they are regulated.
The Reserve Bank of India chief expressed his views during an event. He said that
cryptocurrencies are serious threats to the macroeconomic and financial stability of the
country and also doubted the number of investors trading on them as well as their claimed
market value.
The comments come amid reports suggesting that the government is planning to regulate
digital currencies through a bill which can be tabled during the upcoming Budget. Das has
also expressed his views ahead of the RBI's internal panel report on the contentious topic
which is expected next month.
Cryptocurrencies are a serious concern to the RBI from a macroeconomic and financial
stability standpoint. The government is actively looking at the issue and will decide on it. But
as the central banker, we have serious concerns about it and we have flagged it many times,"
Das said during an event, according to PTI.
The RBI chief, who has been a critic of cryptocurrencies, also questioned the actual number
of crypto investors in the country. This came in response to a recent report which suggested
that more than 10 crore Indians own cryptocurrencies. Several homegrown crypto platforms
have also dismissed the report, claiming that the number is not any more than 2 crore.
"I am not sure about the veracity of these numbers. Of course my view may not be fully right
as we don't get full information about these currencies as they aren't regulated by us or by any
other central bank. But I still think the number of investors look clearly exaggerated as bulk
of them, say over 70 per cent, have invested only about Rs 1,000 each in cryptocurrencies,"
Das said.
Earlier this year, when the government had a stronger stance on cryptocurrencies, the RBI
had expressed its intent to introduce an official digital currency for India. Back then, the RBI
chief said that a committee was working to decide on the model of the central bank digital
currency.
It will be interesting to see whether RBI still brings a digital rupee if the government decides
not to ban the existing cryptocurrencies like Bitcoin.
Writing an Abstract
5-6 minutes
What is an abstract?
An abstract is a 150- to 250-word paragraph that provides readers with a quick overview of
your essay or report and its organization. It should express your thesis (or central idea) and
your key points; it should also suggest any implications or applications of the research you
discuss in the paper.
Note: Your abstract should read like an overview of your paper, not a proposal for what you
intended to study or accomplish. Avoid beginning your sentences with phrases like, “This
essay will examine...” or “In this research paper I will attempt to prove...”
(The examples above are taken from Form and Style (10th ed.), by Carole Slade; The Scott,
Foresman Handbook for Writers (5th ed.); and the Publication Manual of the American
Psychological Association (5th ed.).)
Note: The following are specifications for an abstract in APA style, used in the social
sciences, such as psychology or anthropology. If you are in another discipline, check with
your professor about the format for the abstract.
Many papers in the social sciences, natural sciences, and engineering sciences follow IMRaD
structure: their main sections are entitled Introduction, Methods, Results, and Discussion.
People use the abstract to decide whether to read the rest of the paper, so the abstract for such
a paper is important.
Because the abstract provides the highlights of the paper, you should draft your abstract after
you have written a full draft of the paper. Doing so, you can summarize what you’ve already
written in the paper as you compose the abstract.
Typically, an abstract for an IMRaD paper or presentation is one or two paragraphs long (120
– 500 words). Abstracts usually spend
25% of their space on the purpose and importance of the research (Introduction)
25% of their space on what you did (Methods)
35% of their space on what you found (Results)
15% of their space on the implications of the research
This paper analyzes how novices and experts can safely adapt and transfer their skills to new
technology in the medical domain.
To answer this question, we compared the performance of 12 novices (medical students)
with the performance of 12 laparoscopic surgeons (using a 2D view) and 4 robotic surgeons,
using a new robotic system that allows 2D and 3D view.
Our results showed a trivial effect of expertise (surgeons generally performed better than
novices). Results also revealed that experts have adaptive transfer capacities and are able to
transfer their skills independently of the human-machine system. However, the expert’s
performance may be disturbed by changes in their usual environment.
From a safety perspective, this study emphasizes the need to take into account the impact of
these environmental changes along with the expert’s adaptive capacities.
1. The abstract provides a statement of what the paper will ask or explore rather than what it
found:
X This report examines the causes of oversleeping. (What did it find out about these causes?)
√ Individuals oversleep because they go to bed too late, forget to set their alarms, and keep
their rooms dark.
2. The abstract provides general categories rather than specific details in the findings:
X The study draws conclusions about which variables are most important in choosing a
movie theater. (What, specifically, are these variables?)
√ The study concludes that the most important variables in choosing a movie theater are
comfortable seats and high-quality popcorn.
timesofindia.indiatimes.com
The Indian Crypto Bill 2021: What lies
ahead for crypto investors
SPOTLIGHT / Jan 11, 2022, 12:17 IST
5-6 minutes
TOI TIMESPOINTS
The Indian Crypto Bill 2021: What lies ahead for crypto investors
Top Searches
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A lot has been brewing about the impending Crypto Bill that will change the way the crypto
market regulates currently in India. The overall objective of introducing regulations is to
foster accountability and security. Here, we try to dispel the misinformation, skepticism and
fear surrounding the Crypto Bill by taking a look at the various dimensions and perspectives
surrounding the topic. A look at the various dimensions of the the bill :
#1 Apprehension of a possible blanket ban
A panel discussion of the leadershio of top crypto companies with Members of the
Parliament in November led to the conclusion that cryptocurrencies cannot be stopped and
instead must be regulated.
Blanket ban would be highly improbable considering these facts:
A cabinet note circulated by the government in December said that cryptocurrencies would
be regulated and not banned.
In order to ensure wider adoption and progress of cryptocurrencies, the government
believes regulation to be the best option.
The law will further make provisions to support innovation in the crypto and blockchain
industry.
Central Bank Digital Currencies (CBDCs) or the possibility of a digital rupee are also an
important part of the regulatory framework. RBI is expected to launch its pilot project for
CBDC in the first quarter of the next fiscal year .
#3 On banning private cryptocurrencies
These are coins like Bitcoin and Ethereum that are completely out of danger and can’t be
banned.
On the other hand, cryptocurrencies that are also built on public blockchain networks but
hide transaction information for privacy of the users, may face problems on the regulatory
front.
In the situation of certain cryptocurrencies being banned, consumers would not lose their
crypto holdings as they would receive a time window and prior notice to transfer or sell off
all their assets.
The crypto industry and major exchange platforms like ZebPay are optimistic about the
impact of the bill on the prevailing crypto market. However, caution and planning needs to be
exercised given the ambiguity around the issue.
For the latest crypto news and investment tips, follow our Cryptocurrency page and for live
cryptocurrency price updates, click here.
Disclaimer: The above content is non-editorial, and TIL hereby disclaims any and all
warranties, expressed or implied, relating to the same. TIL does not guarantee, vouch for or
necessarily endorse any of the above content, nor is it responsible for them in any manner
whatsoever. The article does not constitute investment advice. Please take all steps necessary
to ascertain that any information and content provided is correct, updated and verified.
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end of article
Crypto Bill likely to miss Budget session as govt seeks time to build consensus
Synopsis
The Centre is unlikely to introduce the much-awaited cryptocurrency bill in the upcoming
budget session of Parliament as it wants to hold more discussions and build consensus on the
regulatory framework.
The government also wants to wait for the pilot launch of Reserve Bank of India's digital
currency, expected in a few months.
'Complex Subject'
While the Centre is keen on the bill, it is looking to hold more discussions with stakeholders
to firm up a view on the policy, according to officials with knowledge of the matter.
"The crypto bill may not be introduced in the budget session. It is a complex subject. This
will require more time," a senior finance ministry official told ET.
A legislative framework for virtual currencies will also require amendment of some existing
laws.
The government wants to wait for technical inputs from RBI after the pilot launch of its
digital currency, the official said. RBI has raised concerns about private digital currencies,
citing macroeconomic and financial stability issues.
The government had initially listed the Cryptocurrency and Regulation of Official Digital
Currency Bill, 2021 for introduction in the Lok Sabha in in the winter session but that didn't
happen.
No Consensus on Tax
Another reason for the delay may be the lack of consensus over the taxation framework for
virtual currencies, said people with knowledge of the matter. While the government may give
some direction on taxation for investors in crypto assets in the upcoming budget, a full-
fledged taxation framework for the cryptocurrency industry is still a work in progress, they
said.
There is already a consensus on treating cryptocurrencies as assets, an official said, but other
issues were still open-ended.
ET earlier reported that the finance ministry has sought inputs from tax experts. While the
revenue department has received multiple tax proposals from various stakeholders, it is yet to
form a consensus and finalise the rules to tax gains from cryptocurrencies, officials said.
One key view is to treat digital currencies as equities, where profits can be considered capital
gains or business income, based on clearly specified conditions. The counterview is that they
should be treated solely as capital gains.
Tax experts said the existing provisions are not clear and more clarity is needed.
"There are no specific provisions in the law to tax gains in crypto assets and hence, it requires
further clarity," said Rohinton Sidhwa, partner, Deloitte India. "There should be a direction
on cryptocurrency taxation in the budget."
Abstract:
There is a policy vacuum in respect of the crypto-finance ecosystem in India. This paper examines
the regulatory ecosystem which, if adopted, would suit the Indian context. Part I focusses on the
various nuances of the cryptocurrency technology and its role in the finance industry. Part II
discusses the threats of an unregulated crypto-market drawing examples from around the world.
Part III recalls the journey of cryptocurrencies in India and puts forward a possible regulatory
framework which may be suitable to the Indian context.
Abstract:
The world’s financial markets have been abuzz about cryptocurrencies for quite some time now. The
digital currencies, available on a well-built cryptographical technology, facilitate the exchange of
digital representation of monetary value. With a surge in usage of cryptocurrency, it becomes
pertinent for the state to put a regulatory framework in place, to keep illegal activity at bay.