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The state of crypto coins has been wavering in India for a while now. The government decided to set up a committee to look into the case and possibly put an end to all crypto-related activities in the country.
And the committee delivered on the task, recommending to put a 10-year imprisonment penalty on anyone – whether a user or a crypto exchange – caught holding, selling, transferring, trading, or exchanging any kind of virtual currency.
Reacting to the recent ban recommendation of cryptos in the country, the National Association of Software and Services Companies (Nasscom) expressed great displeasure over the government stand. In their opinion, the ban on virtual currencies in India isn’t a constructive move. Instead of chasing these companies abroad, the government should create a regulatory guide to help control this new innovation and harness the slew of potential that it holds.
Nasscom explained further that a ban will only deter legitimate companies from operating in the country, because they are the only ones who wouldn’t want to go against the law. Other con artists will find a way to circumvent these anti-crypto laws and continue their underground operations.
Besides chasing legitimate businesses overseas, this ban could also inhibit new innovations from being deployed to the country – a great loss to the economy of the country. Adding to that, tech startups based on cryptocurrency will also be discouraged from running their businesses in the country.
All these can be mitigated by creating a risk-based framework that carefully monitors and regulate the crypto market in the country.
Crypto Innovation – All-Win Situation
Furthermore, Nasscom added that allowing crypto innovation to thrive in the country will enable regulatory agencies to up their games and learn more about the new environment. It is an all-win situation if manned properly.
“To address consumer protection concerns, cryptocurrency-based businesses can be tested in the regulatory sandboxes being launched by the financial sector regulators across the country. 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.”
Nasscom also commented on the government’s plan to explore blockchain technology for financial and non-financial purposes. Nasscom described the suggestion as a welcomed one and stated that it would “continue working with government stakeholders and seek more discussions on this issue.”
The anti-cryptocurrency sentiments in India have already taken their toll as several crypto exchanges – Coindelta, Koinex and Cryptokart – were shut down due to hostile climate against crypto in the country.