A top government official claimed the country was developing a cryptocurrency consultation document, which might be a hint that the unfriendly climate and rules for cryptocurrencies in India are being eased.

Ajay Seth, India's Economic Affairs Secretary, told the media that the report was nearly finished. They conducted a thorough investigation and interviewed not just domestic parties but also international agencies such as the IMF and the World Bank.

"We hope that we will soon be in a position to finalize [it]."

While the restrictions are unknown, Seth stated that the government is seeking worldwide consensus on bitcoin, reaffirming a previous official position. "India can't succeed unless there is global consensus around that," Seth remarked.

Business Standard stated, citing anonymous sources, that India's Central Board of Direct Taxes (CBDT) is working on rules to clarify how non-fungible tokens, or NFTs, can be taxed.

In April, the government slapped a 30% tax on cryptocurrencies such as Bitcoin, Dogecoin, and Ethereum.

Why Does It Matter? 

At the World Economic Forum's annual Davos summit in 2022, Prime Minister Narendra Modi, who is in his ninth year as India's leader, called for "synchronised action" on cryptocurrencies.

For a long time, India has considered controlling the usage of digital assets in the country. Many big-ticket bitcoin dealers have switched to international exchanges due to the unstable climate and regulatory outrage. The government has also been accused of exerting "informal pressure" on cryptocurrency exchanges in an attempt to force them out.

Cryptocurrency Crisis 2022

At the moment, the entire world is going through a giant cryptocurrency crisis. Bitcoin's price has plunged below $20,000, an all-time low established in 2017. As a result of numerous rumours and ongoing challenges, the stock market, as a whole, plummets.

For the first time since December 2020, the price of Bitcoin dipped below $20,000 on Binance.

Based on the estimate of a prominent crypto quant fund manager, Bitcoin might go below $10,000, according to Fortune's research.

Leigh Drogen, general partner and chief investment officer of Starkiller Capital, a Texas-based digital assets quantitative hedge fund, has been wary of the crypto markets since early this year. He claims that his organisation avoided cryptocurrencies like Bitcoin and Ethereum for much of the first half of the year, preferring to remain on the sidelines. Since November 2022, Bitcoin has lost nearly 70% of its value.

In the meanwhile, Ethereum's price has dropped below $1,000 per ether, losing 10% in the last 24 hours, while BNB, XRP, Solana, and Cardano have all lost a similar percentage. The combined crypto market has lost nearly $400 billion this month, pushing the sector's total value below $1 trillion.