Government says it has no plans to regulate Metaverse, Web 3.0The government has made it clear that it has no plans to apply any regulations on Metaverse or Web 3.0, as these technologies are still evolving.Although the government has imposed a steep 30 per cent tax on income from trade in cryptocurrencies and a 1 per cent TDS levy on every such transaction, starting from April 1, 2022.Finance Ministry sources have said that they are aware of the emerging new technologies and rapid proliferation of technologies like Artificial Intelligence, Blockchain, Drone, Augmented Reality, Metaverse and Web 3.0.They further added that the government has already formulated national strategies for Artificial Intelligence and Blockchain.Also, the Information Technology Act 2000 covers the technology sphere in the country, and therefore the government does not intend to regulate such evolving sectors.The new tax clarification on digital assets’ losses in another cannot offset profits from one asset’s transactions has received severe backlash.The government’s clarification of disallowing losses incurred in a particular digital asset to be set off against income from another version of a crypto holding is “detrimental for India’s crypto industry and the millions who have invested in this emerging asset class,” Ashish Singhal, Co-founder and CEO of CoinSwitch, one of India’s top crypto exchange had said.The government won’t allow tax breaks on infrastructure costs incurred. At the same time, mining of crypto assets won’t be treated as a cost of acquisition, Minister of State for Finance Pankaj Chaudhary told lawmakers in parliament on Monday.The clarification by the minister is a further setback to an industry that was slapped with a steep tax rate of 30 per cent on gains from digital assets’ transactions in the budget unveiled last month. And the lack of regulation is a good thing for metaverse technology, components of which have already been developed within online video games.What is Metaverse?Metaverse is a network of 3D virtual worlds focused on social connection. In futurism and science fiction, it is often described as a hypothetical iteration of the Internet as a single, universal virtual world that is facilitated by virtual and augmented reality headsets.What is Web 3.0?Web 3.0 is an idea for a new iteration of the World Wide Web (www) based on blockchain technology, which incorporates concepts such as decentralization and token-based economics.The term was coined in 2014 by Ethereum co-founder Gavin Wood, and the idea gained interest in 2021 from cryptocurrency enthusiasts, large technology companies, and venture capital firms.
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