Crypto in Focus: Analyzing G20 Summit’s Impact on India’s Regulatory Framework

g20 summit

The recent G20 summit in New Delhi, India, has set the stage for a significant shift in global cryptocurrency regulation which emerged as a pivotal topic amid discussions on various socio-economic and geopolitical issues. In this blog, we’ll delve deeper into what the G20 leaders addressed and what it means for the future of cryptocurrencies, especially in India.

The Crypto-Asset Reporting Framework (CARF)

One of the standout highlights of the G20’s joint declaration is the call for the swift implementation of the Crypto-Asset Reporting Framework (CARF). This framework was developed in response to the rapid growth of the crypto-asset market and aims to standardize the reporting of tax information related to cryptocurrency transactions.

Under CARF, crypto transactions undertaken by individuals and entities in India on foreign-domiciled crypto exchanges will now come under the purview of an automatic exchange of information protocol. In simpler terms, this means that cryptocurrency transactions can no longer be hidden or concealed. The transparency brought about by CARF signifies a significant shift towards greater accountability and taxation in the cryptocurrency space.

India’s Evolving Stance on Cryptocurrency

While the G20 summit provided a platform for discussions on global cryptocurrency regulation, it’s important to note that each member country, including India, will make its determinations regarding cryptocurrency policies.

India, in particular, has been at the center of the cryptocurrency regulatory debate. The country’s budding cryptocurrency industry has had a tough time lately due to high taxes, government rules, and even a partial ban on crypto activities. While leading the G20, India made it a top goal to create global rules for cryptocurrencies.

Ajay Seth, Secretary of the Department of Economic Affairs, clarified India’s cryptocurrency approach. He mentioned that India’s stance on cryptocurrencies would be decided in the coming months, considering the global consensus reached at the G20 summit. The framework for assessing risk, developed collaboratively among G20 nations, will significantly shape India’s crypto policy.

The G20 presidency endorsed global coordination, including the Financial Stability Board (FSB), to supervise digital crypto assets and stablecoins issuance. These implementations will bring crypto firms to operate under a similar financial regulatory body to banks. The declaration document of G20 urges a swift implementation of the Crypto Asset Reporting Framework (CARF) and Common Reporting Standards (CRS), bringing global transparency regarding crypto exchanges for tax purposes. Additionally, the proposed rules will aid financial watchdogs in tracing illicit transactions to prevent money laundering and other financial crimes.

IMF-FSB Recommendations

The G20 summit has welcomed the IMF-FSB recommendations, emphasizing a regulatory approach rather than an outright ban. These guidelines provide a foundation for G20 nations, including India, to craft their crypto regulations. They outline policy suggestions and standards aimed at helping authorities tackle the potential risks to macroeconomic and financial stability arising from crypto-asset activities and markets, including those related to stablecoins and decentralized finance. It currently provides an overview of how the policy and regulatory frameworks developed by the IMF and the FSB align but does not introduce fresh policies or recommendations.

Furthermore, the paper establishes a goal for global financial organizations to gather comprehensive “test” data on various crypto assets used in payment transactions by the conclusion of 2025. This data will offer deeper insights into digital assets and will be categorized by asset type, industry, and the country of the counterparty.

India is on the path to establishing a comprehensive cryptocurrency regulatory framework, drawing inspiration from the joint recommendations of the International Monetary Fund (IMF) and the Financial Stability Board (FSB). The country aims to enact legislation within the next five to six months and is developing a five-point crypto legislative framework with a global perspective:

  1. Establishing an enhanced Know Your Customer (KYC) process for cryptocurrency companies, encompassing compliance with the Foreign Account Tax Compliance Act and existing Anti-Money Laundering standards
  2. Mandating crypto platforms to provide real-time proof-of-reserve audits to regulatory authorities
  3. Implementing a consistent taxation policy across all nations
  4. Granting cryptocurrency exchanges a status equivalent to authorized dealers, akin to banks, as per the guidelines of the Reserve Bank of India (RBI)
  5. Requiring essential roles, such as a Money Laundering Reporting Officer, to be compulsory for cryptocurrency platforms

G20’s Risk Watchdog and the Road to Unified Regulations

Central Bank governors and finance ministers of G20 nations will further negotiate the remaining proceedings in October 2023. The International Monetary Fund (IMF) and FSB will work together to pave the way for a global regulatory framework for the crypto industry.

It’s worth noting that almost two-thirds of the world’s population resides in G20 countries, making the framework’s impact substantial. Countries like Australia, Argentina, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Turkey, the United Kingdom, and the United States will be significantly affected. Additionally, South Korea, Saudi Arabia, Mexico, and the European Union are among other countries in the same bracket.

Commitment to Responsible AI and Global Prosperity

As India passed the G20 Presidency to Brazil, member nations pledged to harness artificial intelligence (AI) responsibly and embraced future possibilities involving cryptocurrency assets and central bank digital currencies (CBDCs). The G20 leader’s declaration emphasized technology’s role in bridging global digital divides. It recognized the group’s interest in shaping policies and regulations for cryptocurrencies and the potential of CBDCs in cross-border payments.

The G20 sees AI as a tool for global digital economic growth and prosperity. They aim to leverage AI for public benefit while ensuring responsible, inclusive, and human-centric solutions safeguarding individual rights and safety. The G20 urged addressing concerns such as data protection, biases, human oversight, and ethical considerations in AI development to achieve this. Their commitment is to unlock AI’s full potential, equitably share its benefits, and mitigate risks through international cooperation and discussions on AI governance.

The G20 reaffirmed its commitment to the G20 AI Principles, drafted in 2019, which outline global policies and cooperation for building trustworthy AI. They also adopted a pro-innovation regulatory approach to maximize AI’s benefits while mitigating potential risks. This responsible AI development drive aligns with the United Nations’ 17 Sustainable Development Goals, aiming to promote peace and prosperity worldwide.


The G20 summit’s focus on cryptocurrency regulation signifies a growing global recognition of the importance of addressing the challenges posed by digital currencies. By advocating for transparency, taxation, and regulation in cryptocurrency, the G20 aims to create a more secure and accountable environment for participants in this rapidly evolving market.

As countries like India evaluate and implement these recommendations, the cryptocurrency landscape will continue to evolve. Whether you are an investor, a cryptocurrency enthusiast, or a policymaker, staying informed about the changing regulatory landscape is essential as the world navigates this dynamic and transformative sector.

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