While crypto-exchange founders in India welcomed the government's resolve to regulate the volatile asset, the founder recommended caution until the contents of the bill were disclosed. On Tuesday, the government revealed its intent to table the Cryptocurrency and Regulation of Official Digital Currency Bill (2021) which strives to regulate the crypto market mechanism in the country, in the upcoming winter session of the parliament commencing November 29.
As per the legislative agenda made public on Tuesday, the bill seeks to prohibit all private cryptocurrencies in India allowing for certain exceptions to promote the underlying technology and its uses. Further, it will strive to create a framework for the creation of the official digital currency to be issued by the Reserve Bank of India.
The development comes a fortnight after Prime Minister Narendra Modi and the Parliamentary Standing Committee on finance and cryptocurrency chaired by Member of Parliament Jayant Sinha met with various crypto-market entities to discuss the way forward. In a televised address, Prime Minister Modi had emphasised that attempts to mislead youth via non-transparent and enticing advertisements had to stop. He added that the unregulated asset cannot be permitted to become an avenue for money laundering and terror financing.
Nischal Shetty, founder and Chief Executive Officer of WazirXIndia enthused optimism on the regulation bill. He suggested that there should not be any case of panic when the regulation the industry has been seeking at large is taking shape. Nischal added that this is not the end but the beginning of crypto regulations in India.
Co-founder and CEO of CoinDCX, Sumit Gupta though welcomed the news governing the regulation of the asset, stated that the contents of the bill are yet to be seen. "If we go by recent statements and our belief in the system, things are going to turn positive as against certain narratives going on right now," he tweeted on Tuesday. Gupta added he has been an advocate of positive crypto regulation and the bill could be the first step in that direction.
The same notion was echoed by the Co-CEO of ZebPay, Avinash Shekhar. He expressed his optimism about the bill that would take into consideration all the views gathered from varied stakeholders over multiple conversations. “We’re awaiting further details on the bill that is going to be presented in the Winter Session of Parliament. There have been many positive steps taken by the government to learn and understand crypto and its impact on all stakeholders—investors, exchanges, policymakers. So, we’re looking forward to a crypto bill that takes into consideration all the inputs from those discussions,” he told Outlook Money.
Founder and Chief Executive Officer of crypto-exchange CoinSwitch Kuber, Ashish Singhal highlighted that there is a broad consensus among varied crypto stakeholders on ensuring customer protection and larger financial stability. “The industry has been actively communicating with all stakeholders keeping investor protection at the forefront. Our discussions over the last few weeks indicate there is broad agreement on ensuring customers are protected, financial system stability is reinforced and India is able to take advantage of the crypto technology revolution,” Singhal told Outlook Money.
Crypto markets in India registered a fall after reports emerged about a potential ban of the unregulated asset. Bitcoin fell approx 17 per cent, Ethereum by 14 per cent, Dogecoin more than 20 per cent and Polkadot 14 per cent, WazirX data showed.
Allaying concerns on the fall in prices after the development was reported on Tuesday, the CoinDCX CEO wrote, "#Crypto prices are caused due to market demands and are not based upon geographies as they are inherently decentralized and distributed. Due to this news, we are witnessing significant discounts only in the Indian markets. Global markets remain unaffected."
He highlighted that the news triggered panic which led the average investor to sell out incurring losses. "As iterated above, I strongly recommend everyone to do research and then make a decision, in times of higher volatility like these," he stated.
