The note reportedly states that cryptocurrency will not be recognised as legal currency, and describes the currency as “cryptoassets”. These assets will be regulated by India’s markets watchdog, the Securities and Exchange Board of India (SEBI), and citizens will be required to declare their assets and refrain from keeping them on exchanges outside the country.

Individuals holding crypto will be given time to transfer their assets once the bill becomes law. Failing to transfer within the timeframe will lead to financial penalties.

Reports emerged in November that the Indian government was considering a bill that proposed creating an official digital currency while banning all private cryptocurrencies. Last week, Finance Minister Nirmala Sitharaman said the bill was being reworked to cater for rapid changes in the industry.

Jay Hao, CEO of cryptocurrency exchange, OKEX.com, said: “Media reports around the Indian government planning to regulate are extremely satisfying. When OKEx entered the Indian market early this year, we were optimistic about India’s strong policy framework. We are now finally witnessing India’s crypto policy taking shape to ensure a better future for the country's entire crypto ecosystem. We can now expect more foreign exchanges to enter India and invest in building the required technical infrastructure and hiring manpower to run their operations. The global crypto community will be closely monitoring the situation as we learn more about the finer details of India’s crypto law.”

Shivam Thakral, CEO, BuyUcoin, said: “We are extremely delighted but not surprised to see media reports regarding the government’s plan to regulate crypto assets, instead of banning them. Since the beginning, we have supported the classification of cryptocurrency as an asset class, similar to gold, stocks, and real estate. It will be interesting to see the timeline and manner in which the crypto bill is implemented across the diverse crypto industry in India."

Thakral added: "Crypto is officially set to go mainstream in India. This will further boost confidence and encourage investors sitting on the fence to start their crypto journey. The crypto startup community in India sees this as a defining moment that will provide much-needed recognition for the hard-working workforce employed by the crypto industry, and will generate large-scale employment opportunities for the country's youth. With such ease of doing business for the digital asset industry, India is well on track to become a 5 trillion dollar economy.”