Major Indian Trade Organization Speaks Out Against Proposed Crypto Ban

A major Indain trade organization, Nasscom calls the recently proposed blanket ban on cryptocurrencies by a governmental panel in the country an unjust, as per a report by local financial periodical The Economic Times on July 30.

We believe that banning #cryptocurrencies is not the solution, a risk based framework must be developed to regulate and monitor cryptocurrencies and tokens.#Cryptocurrency @debjani_ghosh_ @keshav_murugesh pic.twitter.com/S9LbcWk8eX

— nasscom (@nasscom) July 30, 2019

Nasscom commented in the report:

“Nasscom believes that the recent proposal of the inter-ministerial committee of the government to ban all cryptocurrencies barring those that are backed by the government, is not the most constructive measure. […] Instead, the government should work towards developing a risk-based framework to regulate and monitor cryptocurrencies and tokens.”

Nasscom reportedly claims that prior to their launch crypto projects can always be tested in regulatory sandboxes. As per Nasscom, an action such as banning will only push away legitimate businesses who are already pro-compliance. While, Nasscom does add, that much work needs to be done in terms of creating a regulatory framework so as to mitigate illegal activities in the crypto space:

“We should work towards creating a regulatory framework that will constantly monitor and prevent illegal activities. Regulating would allow the law enforcement agencies to be better equipped to understand these new technologies, enable them to gather intelligence on criminal developments and take enforcement actions.”

Founded in 1988, Nasscom has 2,700 member companies across the IT, business process outsourcing and other technology-related industries. 

The Hostility 

Though officialy, there is no ban on cryptocurrencies in India currently, the ban on financial institutions in the country from offering services to crypto-related businesses by the Reserve Bank of India (RBI) has lead a number of crypto exchanges to closed down. 

As per the RBI circular, local banks were prohibited from offering services to crypto-related firms was released by the RBI in April 2018 and  subsequently upheld by the country’s Supreme Court that May. This May,  the crypto exchange Coinome halted its services in India due to regulatory pressure. The exchange allegedly wrote in an email to customers:

“India is currently going through uncertainty on crypto guidelines and regulations. The government of India has not yet taken a decision on the regulatory framework for crypto exchanges or wallets. Further, the supreme court is yet to act upon the public interest litigation (PIL) on (the) regulation of crypto assets.”

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