IT Industry Body President in India Calls Cryptos Illegal

Regulatory approaches to cryptocurrencies differ from one country to the next. Over the last months, crypto regulations start to take shape. The US Securities and Exchange Commission has considered Bitcoin and Ethereum as commodities while most ICOs may fall under securities. However, there are countries such as China that has completely banned cryptocurrency-related activities.

As for India, the Central Bank ordered a few months ago that banks shouldn’t transact with crypto-related businesses. And recently, the president of India’s IT industry body Nasscom mentioned that cryptocurrencies are illegal.

National Association of Software and Services Companies (Nasscom) president Debjani Ghosh said that “very clear that cryptocurrencies were illegal”. She said that the crypto industry should instead take the grievances towards the government.

She said that “It is the law of the land and hence, we have to work with it. If we do not agree, we have to go back to the government and speak about why cryptocurrencies aren’t correct (legal)”.

Currently, Bitcoin and other cryptocurrencies are not considered as a legal tender in India. However, it should also be noted that it still hasn’t been ruled as illegal. There have been petitions at the Supreme Court asking clarity regarding the issue. This was after the country’s central bank, the Reserve Bank of India decided to enforce a strict policy that prohibits banks from providing services to any business that is related to cryptocurrencies.

Struggle for Crypto Regulations

This week, Indian authorities arrested the co-founders of the top crypto exchange that operates a Bitcoin ATM in the country. The reason behind the arrest of Unocoin’s co-founder is because of the non-operational ATMs.

The other founder of Unocoin, Sathvik Viswanath mentioned that it is important to know that even if Bitcoin is not a legal tender, it doesn’t make it an illegal asset. He said that “The minister’s statement was clear: cryptocurrencies are not legal tender in India. He did not say ‘illegal tender’. There’s a huge difference. It means you bear the risk of your investment and there’s no regulation for the industry”.

Though the government is doing its best to keep cryptocurrency exchanges out of business, it has created black markets that appear to be getting stronger in India. You have the LocalBitcoins market in India that has better rates for acquiring your cryptocurrencies. In fact, it has become a gray area.

Regulatory Clarity is Needed

Regulatory clarity is needed in different parts of the world today. And this is also what institutional investors are waiting for. Though there are still only a few players that decided to enter the crypto market, there are a number of notable progress in the industry including Bakkt, which is backed by ICE and Microsoft. Also, you have the likes of Fidelity deciding to enter the crypto market by having a company for cryptocurrencies.

And not only that, you also have the possibility of having a Bitcoin ETF getting approved in the near future. Is India doing the right decision to clamp down on crypto-related activities? Should they be more lenient when it comes to cryptos?