The creation of the regulatory sandbox for crypto-related business was meant to put an end to the hardstand the India government has had towards crypto. However, upon receiving the framework from the Reserve Bank of India for business operations allowed in the sandbox, it was yet another disappointment. The RBI had excluded crypto related business together with other blockchain projects from its sandbox.
However, now India’s IT industry trade body Nasscom has come out strongly to urge RBI to reconsider its decision and allow excluded projects into the sandbox. Nasscom said;
“The decision by RBI to keep out important aspects of blockchain technology, that is, smart contract, tokens, initial coin offerings together with the trading of cryptocurrencies is just absurd. The latter forms the basis of cryptocurrencies together with its pillar blockchain technology, yet the latter is allowed in the sandbox. It is high time that RBI reconsiders its decision.”
Nasscom sentiments were echoed by another group Payments Council of India (PCI), led by its chair Naveen Surya who said;
“Since the government has not placed a complete ban on cryptocurrency technology, the latter should be in the sandbox. Boundaries can’t be placed right away. Instead, RBI should create an open framework, and forgo creating subsets of existing laws.”
While all the bodies in India are calling for the addition of crypto into the sandbox, it doesn’t make sense that something used by regulators such as those in the UK is shunned by Indian regulators. Furthermore, the projects will be under its purview with RBI exercising its full control over the projects.
Moreover, the risks will be minimal since the projects will be used by a limited number of users. Although all facts point to RBI having control over all projects, it is strange that the same regulators haven’t come out clearly to state out factors preventing them from including all the above projects. Instead, they have turned to kill the crypto sector in India by imposing strict regulations.
The latter has led to stakeholders walking out of India’s crypto sector. It’s just recently that Coinome a crypto exchange present in India just shut down citing regulatory issues as the main reason. Coinome joins Zebpay which walked out of the Indian crypto sector sometime back.