The ministry of corporate affairs’ (MCA) latest mandated disclosure of cryptocurrency transactions by companies is aimed to protect investors from fraudulent high-return schemes floated by firms involved in cryptocurrency trading, according to a government source.
The move would bring in greater transparency in the activities of companies engaging in trading of cryptocurrencies, which are not legal tender in India, the person said.
The decision was taken after a government-constituted committee took cognizance of complaints from investors and various media reports, they said.
In April 2019, the MCA constituted a committee to make recommendations to expand the ambit of the Companies (Auditor’s Report) Order, 2016, (CARO), which lays down audit reporting norms. The committee had recommended the inclusion of disclosures on cryptocurrency holdings and trading under Schedule III of the Companies Act, according to official sources.
