A former deputy governor of the Reserve Bank of Republic of india (RBI) has spoken out most the nation's financial and crypto ecosystem and stated that digital assets demand to be accepted.

Speaking at the inaugural Hodl 2022 virtual conference organized by the Blockchain and Crypto Assets Quango of the Internet and Mobile Association of India on Tuesday, Rama Subramaniam Gandhi said that crypto could be used for payments for economical activities, but he sees them more as an asset class.

The regulatory situation in India remains unclear, with bills and legislation even so being mulled by politicians. Before this month, the government announced that it was working on a draft bill to define cryptocurrencies as commodities where they could exist taxed. If passed, it would not allow them to be used for payments, but to be traded and invested in equally assets instead.

The key bank banned all commercial banks from allowing their customers to make cryptocurrency-related transactions in 2022, still, the ruling was overturned by the Supreme Court of Bharat in February 2022.

Gandhi, who served at the central bank from 2022 to 2022, maintains that cryptocurrency needs to be treated equally an asset or commodity and taxed accordingly. Developing a regulatory framework and treating them as such would allow Indians to invest and hold digital assets. If the avails accept been mined instead of purchased, they should be field of study to majuscule gains tax, he added.

"Cryptocurrencies should be paid for through normal payment channels. If they are not, information technology should be deemed mined, and capital gains taxation must exist levied. That is like voluntary disclosure."

The quondam central broker opined that cryptocurrencies would exist used for crimes if there were no regulations or government oversight. He said that transactions could be tracked through a central repository to facilitate trade and forestall illicit apply.

Related: Indian government is rethinking crypto ban

Gandhi stated that the government should have an open mind toward economical transactions involving cryptocurrencies but cautioned about the anonymity features that some blockchains accept, adding that society must adhere to any compliance rules ready by the state:

"A state volition always want to give freedom to its citizens in terms of economical transactions. It enforces contractual obligations and taxes income and gains. And so, any economic activity should be amenable to these kinds of things."