Guidelines on Legal Framework for Cryptocurrency in India

The word crypto originated from Greek word “kruptos” meaning hidden or secret. This Article discusses on the legal validity of crypto currencies in India. Further studies on the regulatory body for the new digital currency payment and the cryptocurrency system. Crypto currencies with money laundering and its effects have been dealt with. As the talk of cryptocurrency increasing day by day, people are more attracted to it and started investing in that. But the government of India is still on discussion to give recognition for this decentralized currency. As there is no proper regulation for cryptocurrency in India, it lies in the state that whether it is a legal tender or not. Further elaborates on the problems faced by India Government to bring the cryptocurrency as a legal tender or to ban. It gives the information on the discussion made by the Reserve Bank of India, along with the finance minister to build up a new regulation for cryptocurrency. And it also highlights on the risks the investors might face in case of defect in the transaction of cryptocurrency as it is one way transaction. The guidelines on the statutes of the PMLA, Foreign Exchange Management Act, Narcotics, Drugs and Psychotropic substances, RBI, SEBI and more other regulations to prevent from money laundering are also discussed in this Article. As the system of this decentralized cryptocurrency is more vulnerable to these kinds of cybercrimes, it must be protected from being exploited and protect the investors as well and prevent them from loss, for that formulation of a regulation for cryptocurrency can be made instead of being banned.