The Securities and Exchange Board of India (SEBI) has warned advisers against dealing in assets that are not regulated in the country. The SEBI said that it would take action against any investment adviser dealing in unregulated assets, including digital gold. In India, cryptocurrencies are also considered to be unregulated assets.
The warning comes after recent comments from the CEO of India’s newest crypto “unicorn”, CoinSwitch Kuber, stating that the government and regulators are discussing crypto industry regulations with crypto companies.
The Indian government has relaxed plans to ban crypto outright and is now looking to regulate its use in illegal transactions.
Rise of cryptocurrency in India
India’s cryptocurrency market has grown by 600% over the last year. The country also has a 59% share in decentralised finance activity. This rise in crypto popularity has prompted regulatory bodies to consider imposing strict regulations on the crypto industry in the country, to ensure the safety of crypto users.
The Indian Government has proposed a new bill, The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, that would ban cryptocurrencies in India, apart from certain exemptions that would promote innovation.
It seems that the government has backtracked on its plan to ban the currency and is now looking to tighten regulations while still allowing the digital asset to be traded in the country.
Part of the government’s plans also included the introduction of a framework for creating an official cryptocurrency that would be issued by the RBI. The official currency would be created to mitigate the risks of crypto trading however, many believe that the risks of trading would remain the same.
The popularity of crypto in India is not calming down, with 1.5 million citizens investing in the asset. With so much speculation, the government is expected to continue developing their crypto regulation throughout the rest of the year.
