RBI discloses in its annual report, that the regulators feel the need to keep track of trade in virtual currencies turning opaque. The report states:
On April 06, RBI directed the nation’s bank to not to support or engage in any cryptocurrency trade and exchanges. It further allotted them three months time to wind down all business relationships pertaining to the digital assets. Indian crypto enthusiasts while disheartened, migrated to peer-to-peer trade and crypto-to-crypto business model to circumvent the ban. The former involves the exchanges connecting the buyer and seller, while in crypto-to-crypto transactions, traders can buy units of one digital currency for another at predetermined rates.
Some of the local exchanges have plans to shift their offices to more crypto-friendly countries. However, they feel that RBI could have been more complacent towards crypto and instead of coming down heavily on it, they should have taken prudent steps to understand the ecosystem and regulate it. Praveen Kumar, chairman, and CEO of Belfrics, a Malaysia-based exchange with operations in India states:
“Though cryptocurrency may not currently pose systemic risks, its increasing popularity leading to price bubbles raises serious concerns for consumer and investor protection, and market integrity,”
Read more: Reserve Bank of India Employs a Special Unit to Comprehend Cryptocurrencies, Blockchain, AI
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