I recently came across this news on
Economic times. All global CEX have been or are being requested to share their user database to the government of India. Every major CEX has made it mandatory for its users to pass KYC, it will be easy for them to collate the data and share it with India. India took this responsibility as it had the Presidency of the G20 summit 2023.
The problem that India will face is that these exchanges are based in countries that are tax heaven, those exchanges cannot be forced to share the data. India has time till March 2024 to come up with the database before the next G20 summit in 2024. Once the database is created it will be shared with the G21 group to fight against crime commited using cryptocurrency.
What do you think will be the impact of this database to the Indian community that are using International centralized exchanges?
Thanks.
It's difficult but not impossible! But if it happens, all crypto exchanges will loose their credibility and might have to breach their own privacy policy. Also many countries have their data protection act which might get breached. So it's difficult but not entirely impossible.
This is very risky for those people who have been under reporting their crypto income in their tax return. That's why I always mention not to stand on the different side of the law. It's better to pay 30% tax than to get into regulatory hassles.