India RBI pushes crypto prohibition

India's central bank, the State Bank of India (RBI), has reasserted its call for a cryptocurrency policy 'leaning towards prohibition,' warning that crypto assets and stablecoins could threaten financial stability and monetary sovereignty. Internal government documents reviewed by Reuters reveal that the RBI advocates barring banks and financial institutions from holding, trading, or gaining exposure to crypto assets and privately issued stablecoins. Meanwhile, India's Income Tax Department warned that trading via offshore exchanges is hard to track and found that fewer than a quarter of 645,000 individuals who made crypto transactions in FY2022-23 reported them on tax returns. The India — Ministry of Corporate Affairs is examining accounting standards for virtual digital assets. Despite policy ambiguity, India has nearly 39 million crypto traders holding about $2.1 billion in digital assets. The government has yet to adopt a formal policy, balancing innovation with risk management.