Cryptocurrency and Digital Assets by Altacit Global

1. Regulation of
Cryptocurrencies and
Digital Assets
- Bhavishya Bheemineni

2. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
INTRODUCTION
What are Cryptocurrencies and Digital Assets?
Cryptocurrencies are a type of digital currency that uses cryptography for
secure transactions, control the creation of new units, and verify the
transfer of assets. They operate on decentralized networks, typically
using blockchain technology.
Digital assets refer to any asset that exists in a digital format. This broad
category includes cryptocurrencies but also encompasses other types of
assets like digital art, music, or even real estate represented digitally.
Digital assets can represent ownership or value in the digital world.

3. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
How do they work?
Initiating a Transaction
│
▼
Signing the Transaction
│
▼
Broadcasting the Transaction
│
▼
Validation by Miners/Validators
│
▼
Confirmation
│
▼
Completion

4. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
India’s Stance on
Cryptocurrencies
Section 2(47A) of the Income Tax Act, a Virtual Digital Asset (VDA):
Any information, code, number, or token (not being Indian currency or foreign
currency), generated through cryptographic means or otherwise, by whatever name
called,
○ That provides a digital representation of value,
○ Is exchanged with or without consideration,
○ Involves storage, transfer, or trading electronically.
1. Any non-fungible token (NFT) or any similar token.
2. Any other digital asset as notified by the Central Government in the Official
Gazette.
Finance Act, 2022 officially added the taxation framework for VDAs (Sections
115BBH & 194S).

5. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
Key Laws Regulating
Cryptocurrencies in India
Income Tax Act, 1961: 30% tax on gains, 1% TDS on large transactions.
PMLA, 2002: Crypto exchanges must follow AML & KYC rules, report suspicious transactions.
FEMA, 1999: Regulates cross-border crypto transactions; RBI oversees compliance.
IT Act, 2000: Covers cybersecurity and fraud in crypto transactions.
Companies Act, 2013: Crypto businesses must report digital asset holdings.
RBI & Digital Rupee: Private crypto not recognized; Digital Rupee (CBDC) introduced.
Consumer Protection Act, 2019: Protects against fraudulent crypto schemes.
SEBI Regulations: Crypto not yet classified as a security but may be regulated.

6. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
Comparison with Global
Regulatory Frameworks
1. United States
• SEC treats some cryptos as securities,
CFTC regulates crypto derivatives.
• IRS taxes crypto as property, subject to
capital gains tax.
• Strong compliance with AML & KYC
laws.
1. European Union
• MiCA (Markets in Crypto-Assets
Regulation, 2023) provides clear legal
framework.
• Requires licensing for crypto firms, strong
consumer protections.
1. United Kingdom
• FCA regulates crypto exchanges under
AML laws.
• Crypto gains subject to capital gains tax.
4. China
• Complete ban on crypto trading &
mining (2021).
• Government promotes Digital Yuan
(CBDC) instead.
5. Japan
• Crypto legalized under Payment
Services Act.
• Requires strict AML/KYC
compliance.
6. Singapore
Balanced approach: Regulated under
Payment Services Act (PSA).

7. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
Compliance Requirements for
Crypto Businesses in India
In March 2023, India expanded PMLA to include coverage of
cryptocurrencies within its ambit, and now requires:
• Crypto exchanges will have to conduct KYC verification of users.
• Exchange has to submit all suspicious transactions to FIU-
IND(Financial Intelligence Unit of India).
• Strict compliance with the AML (Anti- Money Laundering) measures
so as to curb illegal financial activities.

8. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
Internet and Mobile Association of
India vs. Reserve Bank Of India (2020)
The Supreme Court struck down the RBI’s banking ban, ruling that:
1. Disproportionate Restriction: The ban violated Article 19(1)(g) of the
Constitution, which guarantees the right to practice any profession or business.
2. Lack of Evidence: RBI failed to prove that cryptocurrencies harmed the
financial system.
3. No Legislative Support: The court held that RBI could not impose an outright
ban without a law passed by Parliament.
Takeaways: Crypto exchanges regained access to banking services, allowing them
to operate legally in India.

9. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
Avinash Mehrotra v. Union
of India (2021)
A Public Interest Litigation (PIL) was filed in the Supreme Court demanding a
complete ban on cryptocurrencies. The petition argued that:
o Cryptocurrencies enable illegal activities (money laundering, tax
evasion, terror financing).
o Lack of regulation poses a risk to retail investors.
Judgement:
The court refused to impose an outright ban and instead:
1. Urged the government to frame clear regulations rather than prohibiting
crypto entirely.
2. Recognized the economic potential of blockchain and digital assets.
3. Advised regulatory clarity instead of reactive bans.

10. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
Binance & WazirX AML
Investigations (2022-2023)
India’s Enforcement Directorate (ED) launched investigations into WazirX, Binance,
and other exchanges for alleged violations of:
1. The Prevention of Money Laundering Act (PMLA), 2002 – Failure to report
suspicious transactions.
2. Foreign Exchange Management Act (FEMA), 1999 – Unauthorized cross-
border transactions.
WazirX’s bank accounts were frozen for allegedly facilitating 2,790 crore in illegal
₹
transactions linked to fraud.
Judegement:
• Crypto exchanges were forced to comply with AML laws:
• Exchanges must register with the Financial Intelligence Unit of India (FIU-IND).
• Strict KYC (Know Your Customer) verification and transaction monitoring
became mandatory.
• Exchanges were warned against allowing offshore, unregulated trading.

11. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
Intersection of Crypto Law
& Intellectual Property (IP)
1. NFT & Copyright Protection
The "MetaBirkins" case where Hermès sued an artist for trademark infringement over
NFT versions of its luxury handbags.
2. Trademark Protection for Crypto Brands & Exchanges
Binance and other exchanges have fought legal battles over unauthorized use of their
brand names.
3. Patents in Blockchain & Crypto Innovations
IBM and Bank of America have filed patents related to blockchain and crypto
payments.
4. Smart Contracts & IP Licensing
Music artists use smart contracts to automate royalty payments via blockchain.

12. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE
EMERGING TRENDS &
CONCLUSION
• Stricter AML & KYC Compliance
• Taxation & Financial Reporting
• Central Bank Digital Currencies
(CBDCs) as Alternatives
• Potential Crypto Legalization &
Licensing Regime in India.

13. CHENNAI
C2-A, Industrial Estate,
Guindy, Chennai - 600 032.
Tel: +91 - 44 - 22501318, 42107341
BANGALORE
D-04, Solus Floor-4,
1st A Cross, JC Road,
Benguluru – 560027
Mob: +918277460648
COIMBATORE
2nd fl, Nivasan Echo Point – Plaza, Avinashi Road,
Civil Aerodrome Post,
Coimbatore – 641014
Mob: +919385432921
HYDERABAD
Office No.337,Regus Eversun Business Center SL
Jubilee Third Floor, Plot No.1202 & 1215A,
Hyderabad - 500033.
Mob: +917901691606
COCHIN
Suite 49, 8th Floor, Centre A,
Alapatt Heritage Building,
MG Road, Cochin – 682035
Tel: +91 - 484 - 2366216
EMAIL
info@altacit.com
WEBSITE