The interdisciplinary committee finalising a regulatory framework for cryptocurrency trade in India has no representation from the stakeholders or players in the segment.
The 10-member committee, which is headed by Subhas Chandra Garg, Secretary, Department of Economic Affairs, comprises officials from the Department of Economic Affairs, Department of Financial Services, Department of Revenue (CBDT), Ministry of Home Affairs, Ministry of Electronics and Information Technology, Reserve Bank of India, NITI Aayog and State Bank of India to decide on the fate of cryptocurrency in the country.
Industry players such as Zebpay, Unocoin, Belfrics, and WazirX, among others, have expressed disappointment over the committee’s move to work on a framework without having any representation from the industry.
“That’s the saddest part as the inclusion of fintech and crypto exchange players would have made the proposal competitive and workable,” said Praveen Kumar, CEO, Belfrics, a leading cryptoexchange.
Gopal Modi, founder of another exchange called CoinRecoil, said the company’s legal firm Khaitan and Khaitan had raised the issue (of exchanges not having a representation in the committee) in the Supreme Court, to which the apex court had asked crypto players to send their respective recommendations to the RBI.
“However, the RBI has not reverted on the recommendations. Besides, how can a committee not have a single voice from the industry?” asked Modi, who moved the Supreme Court in May this year over the RBI’s decision to bar banking institutions from dealing with cryptocurrencies. According to sources, the committee has also not asked for any formal recommendations from crypto players, mostly exchanges dealing with trading of Bitcoins, Ethereum and other Altcoins.
But the crypto and blockchain arm of IAMAI (Internet and Mobile Association of India) met with individual members of the committee to discuss the importance of blockchain and future of cryptocurrencies in the country and globally.
“We have met the committee members individually and made recommendations on how to regulate cryptos. The problem is the government is not acting fast to resolve the issues related to the legality of Bitcoins in India,” said Ajeet Khurana, CEO, Zebpay.
Khurana said that the committee is most likely to come up with its report before September 11, when the final hearing on the petition filed by various exchanges against the RBI would be heard in the Supreme Court.
“The committee has called us for a meeting before making the report public,” Khurana said without disclosing the date.
Khurana said that during the previous meeting, IAMAI, through its recommendations, had explained to the committee the manner in which liberal democracies have approached the issues related to cryptocurrencies, and the way they are working with the existing payment ecosystem.
“For any crypto to function in a legal way, it has to co-exist with the traditional payment paradigm. Only then, cryptos can be traceable,” Khurana said, adding that even after the banking system has officially disengaged with the crypto exchanges, the ecosystem is thriving on the peer-to-peer channel, which is not traceable. “It is ingrained in the ecosystem.”