Very exciting news may be coming out of India by this time next month. According to the latest reports, India might officially recognize Bitcoin as money before summer and impose a tax on the digital currency as the answer to its recognition. This is not a new phenomenon going by what’s been happening in some other countries lately.

Indian media: government plans to give Bitcoin legal status

In the report, there are indications that the committee recently constituted by India’s Reserve Bank to look into activities related to digital currencies such as Bitcoin will make its recommendations known between May 15 and 20. Afterwards, the government would be left to decide on what to come next.

A translated version of the news broadcast (originally in Hindi but translated for the Cointelegraph) says:

"The government is planning to give Bitcoin a legal status. As per the exclusive information received by CNBC Awaaz, the government is planning to regulate Bitcoin and have necessary taxes on it. The common virtual currency, Bitcoin, is not currently regulated and the government has plans to do so. That means all the activities related to Bitcoin should be properly monitored (and) applicable taxes should be added. The RBI should have guidelines for investing in Bitcoin, sending and receiving money from abroad through Bitcoin should have guidelines from FEMA. Some members (of the committee) also say it should be banned. But the majority wants to regulate it. The proper regulations will be out by mid-May."

Bitcoin in India

India has been touted to be one of the countries that would shape Bitcoin's future in the coming years. The demonetization exercise embarked upon by the country late last year played a crucial role in the rise of Bitcoin’s price over the $1,000 range.

The country has also been in the news lately for the central bank’s inability to keep up with demand for new banknotes which has lead to dry banks and ATMs affecting millions of consumers.

A co-founder of Zebpay an app-enabled Bitcoin wallet and exchange, Sandeep Goenka, once hinted that the low penetration of plastic money will make Bitcoin succeed in the world’s second most-populated country. A new class of users, including young professionals and High Net-worth Individuals (HNIs), are also showing interest in Bitcoin as an alternative investment and for other online uses.

As earlier reported, one of the top largest economy in Asia stands to gain more than lose from recognizing the digital currency. With its more than 1.2 bln population, it would be a great news if the recognition pulls through. Let’s hope for a positive outcome.