According to official papers made public by Reuters, SEBI suggested that several authorities collaborate to regulate the country's cryptocurrency industry. The recommendations were made to the finance ministry advisory body in India.

As per the idea, SEBI will oversee cryptocurrencies that are categorized as securities, as well as initial coin offerings, and grant licenses for items that are associated with them.

The Insurance Regulatory and Development Authority of India will be in charge of all insurance issues pertaining to cryptocurrencies. In the interim, cryptocurrency-related pension-related issues will be overseen and regulated by the Pension Fund Regulatory and Development Authority.

The idea also recommends resolving investor issues under the country's Consumer Protection Act.

It was suggested that the Reserve Bank of India (RBI) manage stablecoins backed by fiat currency. The regulator, though, has presented a less optimistic picture of cryptocurrencies.

According to people with knowledge of the situation, the RBI supports a complete ban on stablecoins. Tax evasion is a topic that the regulator has brought up.

The organization has furthermore issued a warning, stating that voluntary compliance is a must for decentralized peer-to-peer cryptocurrency transactions, which puts financial stability at risk.

Furthermore, according to the RBI, central banks would lose out on money creation earnings as a result of cryptocurrencies.

"This move is an important first step toward enacting national laws for the industry. Given the variety of uses for Virtual Digital Assets (VDAs), the idea to establish an interministerial organization to oversee them is in line with industry goals, according to Dilip Chenoy, head of the Bharat Web3 Association (BWA), in an interview with crypto.news.

Chenoy continued, saying that the BWA is presently "drafting a comprehensive document to this effect," in response to the government's demand for business input to assist shape the country's regulatory strategy.

In light of this, international cryptocurrency service providers have been pushed for a Financial Intelligence Unit (FIU) license by Indian officials. Only KuCoin and Binance had satisfied with the standards as of the time of publishing.

The FBI has also taken part in campaigns aimed at encouraging market participants across to comply. Addressing the Virtual Asset Service Providers (VASPs) during a recent capacity-building and training event, FIU Director Vivek Aggarwal emphasized the need of adhering to the Anti Money Laundering / Countering the Financing of Terrorism (AML/CFT) framework.