Key Highlights
- India’s Parliamentary Standing Committee on Finance recommended an interim crypto regulatory framework through recognized Self-Regulatory Organizations (SROs).
- The panel urged the government to define virtual digital assets across securities, derivatives, and other financial categories.
- Lawmakers sought clarification on whether tokenized securities and crypto investment products should fall under the proposed Securities Markets Code.
A parliamentary committee in India has suggested creating temporary rules for cryptocurrencies and other digital assets, stating that more regulation is necessary.
The committee made this recommendation in its 36th Report on the proposed Securities Markets Code for 2025, which was submitted to Parliament on July 23rd.
Rather than classifying cryptocurrencies as securities, lawmakers suggested creating Self-Regulatory Organizations (SROs). These SROs would be overseen by a specific regulatory body.
To minimize potential problems and maintain a healthy market, the system needs clear basic rules for things like how it’s managed, openness, what information is shared, protecting investors, handling complaints, following the law, and ethical behavior.
Why Parliament is pushing for crypto SROs
These new recommendations are the result of months of discussions involving lawmakers, regulatory bodies, government officials, and people working in the cryptocurrency field.
The committee has met several times with leading cryptocurrency exchanges like Binance, WazirX, and ZebPay. They also consulted with officials from the International Financial Services Centres Authority (IFSCA) and different government departments to get a better understanding of the changing world of digital assets.
During further discussions, lawmakers asked representatives from the Reserve Bank of India (RBI) and the Institute of Chartered Accountants of India (ICAI) to share their opinions on topics like cryptocurrencies, how they should be taxed, accounting rules for them, and potential risks to the financial system.
This report includes input from discussions with the Reserve Bank of India, the Income Tax Department, cryptocurrency exchanges, and other involved parties.
Why defining digital assets matters
As a crypto investor, I was glad to see the committee push for some clarity around regulations. They’re recommending temporary oversight while also urging the Ministry of Finance to really define what these digital assets *are* legally. It’s a big deal because most cryptocurrencies don’t fit into the old boxes like stocks or traditional derivatives – they need new classifications that actually make sense based on how each crypto works.
The committee also asked the government to clarify whether:
- Crypto investment products would be covered under the proposed Securities Markets Code.
- Exchanges offering tokenized securities would fall within the legislation’s scope.
- Additional enabling provisions are required to ensure regulators can oversee tokenized financial products.
The report also points to increasing interest in tokenized real-world assets – things like stocks, bonds, or property represented as digital tokens – which are quickly gaining popularity around the world.
Government position on crypto remains unchanged
The committee suggested temporary supervision of cryptocurrencies, but noted that the Indian government hasn’t significantly altered its position on them. Currently, regulations mainly cover areas like taxes, preventing money laundering, and reporting requirements – it’s not a comprehensive regulatory framework.
According to a recent report, the Indian government currently doesn’t have specific rules for crypto-assets, also known as Virtual Digital Assets, except when it comes to taxes, preventing money laundering, and required reporting.
The committee recognized that effectively regulating digital assets would need collaboration both within the country and with international partners, due to their worldwide use. Therefore, lawmakers decided it wasn’t the right time to directly add cryptocurrencies to the existing Securities Markets Code.
What these recommendations could mean for crypto
As an analyst, I’m seeing a clear shift in how Parliament is approaching crypto regulation. They don’t seem inclined to rush into a completely new law right away. Instead, they’re leaning towards a more gradual strategy – starting with oversight through Self-Regulatory Organizations (SROs) while they continue to debate the bigger picture of crypto policy. It’s a phased approach, allowing them to supervise the industry now and develop comprehensive rules later.
These recommendations don’t immediately change the legal situation for cryptocurrency in India. However, they strongly suggest that the government is giving increasing priority to formally regulating the crypto industry, including investment products and digital securities.
2026-07-23 22:30