Cryptocurrencies are still not legal in India, but Fintech Firms and tech body Nasscom want the central bank of the country to include them in its regulatory sandbox.
Over the past half a decade, cryptocurrencies have become one of the most popular investments for millions of people all over the world, and in that regard, India is no exception. Plenty of cryptocurrency exchanges have opened up over the years and have drawn millions in crypto investments from Indian citizens. However, as far as regulation is concerned, the country is lagging by a fair margin, and that is what has been the chief source of concerns for both technology lobby groups like Nasscom and the budding technology firms in the country. The lack of a proper regulatory structure has been an issue for plenty of tech firms in the country, and while the country’s government has stated that Blockchain technology has its uses, it has refused to regulate cryptocurrencies in any meaningful. It is not a surprise that lobby groups and fintech firm have no decided to take the matter up with the Reserve Bank of India (RBI), the country’s central bank.
The document titled ‘Draft Enabling Framework for Regulatory Sandbox’ was published by the RBI on the 18th of April but to the dismay of crypto enthusiasts, fintech firms and scores of information technology companies, cryptocurrencies, and initial coin offerings were not included in that framework. However, it is important to note that the central bank, which is also a regulatory body, had asked for feedback on the sandbox document from concerned parties until the 8th of this month and the fintech firms along with Nasscom, the tech lobby group, took up the institution on its offer. In this regard, it must be noted that distributed ledger, one of the most important aspects of Blockchain technology and cryptocurrencies had been in fact, included in the framework.
Since crypto coins and tokens are an important component of the blockchain technology, the draft regulations appear to exclude testing of smart contracts and other approved blockchain technology under the sandbox.
It went on to add that the sandbox is currently unclear on where it stands in terms of initial coin offerings, crypto trading and cryptocurrencies in general. In addition to that, the Payments Council of India, which is a lobby group for the payments industry in the country, also voiced its concerns about the developments. It stated that the sandbox is unclear on the regulation regarding cryptocurrencies, and the exclusion of such a large group of potential currencies of the future is not a great thing.