India's independent Web3 advisory body, the Bharat Web3 Association (BWA), has prepared a message for Nirmala Sitharaman, who returned as the nation's finance minister for a second term this month. In its message shared with Gadgets360, the BWA said that India needs a level playing field for startups and Web3 companies to thrive. India is currently in the process of rolling out regulations to oversee the Web3 sector. The aim is to ensure that India's crypto circle is protected against the financial risks that volatile digital assets could expose them to.
Web3 needs government support, says BWA
The BWA, which has a total of 36 members from the crypto industry in India, has been working with lawmakers to help them draft the right rules and regulations to govern the digital asset sector without hindering its growth.
Now that Sitharaman is back and expected to present the finalized Union Budget 2024 in the coming days, the BWA has decided to raise awareness of the needs of the Web3 sector.
“The Web3 sector has immense potential to revolutionize various sectors, including finance, governance and supply chain management, while improving transparency and efficiency. In view of this, we propose to the government to develop a framework clear regulatory framework for Web3, support virtual digital asset (VDA) providers in their customer focus and streamline the tax framework for the digital asset sector,” said Dilip Chenoy, president of the BWA. your statement.
The BWA said it is of the utmost importance that Web3 services have access to the provision of banking services. The advisory body has also urged the government to encourage investment and growth in the Web3 sector. The BWA and its members are concerned that if India delays creating a lucrative ecosystem for Web3 to grow, it could miss out on profitable and technical opportunities like it did during the Web2 era.
India's current position on Web3
Between 2022 and 2024, India took some decisive decisions on Web3 regulations. From July 2021, India brought crypto earnings under a tax regime. In India, crypto income is taxed at 30 percent, while one percent TDS is deducted on every crypto transaction. The country has brought the crypto sector under the Money Laundering Prevention Act, which requires all providers of virtual digital assets to collect KYC details of their customers and report any suspicious activity identified to the relevant authorities.
During December 2022 and 2023, India served as the chair of the G20 group of nations. As part of its chairmanship, India worked with the International Monetary Fund (IMF) and the Financial Stability Board (FSB) to draft cryptographic regulations that work uniformly globally.
Despite India's gradual approach to wholeheartedly welcoming the Web3 sector as part of its financial and industrial ecosystem, the country has shown remarkable growth in blockchain adoption by 2023, according to a report published by Hashed Emergent, a Web3 venture capital firm focused on India. .
From three percent in 2018, India's overall share of the blockchain developer pool increased significantly to 12 percent last year, according to the report. The country also claimed the top spot for on-chain adoption by 2023 in over 150 countries, reflecting over 35 million trading accounts on major Indian exchanges. The report has predicted that India has a promising future in terms of establishing itself as a leader and early adopter of Web3 technologies, especially because of its large pool of developers.
While India's crypto circle expects Sitharaman to reduce crypto taxes, the finance minister has so far ignored the industry's urges.
