Indian Crypto Regulation Ready by September: Official

Indian Crypto Regulation Ready by September: Official

The Indian government is expected to issue detailed cryptocurrency guidelines by September, a senior official from the country’s Ministry of Finance reportedly said. Consultations with all stakeholders including the central bank have already begun. This announcement is independent of the supreme court’s hearing of petitions relating to crypto regulation in India.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Regulation Expected by September

The Indian government has reportedly finished drafting the regulatory framework for cryptocurrencies. The New Indian Express wrote on Saturday that the government is “likely to issue guidelines on cryptocurrency by September.”

Indian Crypto Regulation Ready by September: Official
Subhash Garg.

This news follows the statement last month by the country’s Economic Affairs Secretary, Subhash Garg, confirming that the draft law would be ready by mid-July.

Citing that stakeholders include the Securities and Exchange Board of India (SEBI), the Reserve Bank of India (RBI), and the Internet and Mobile Association of India (IAMAI), an unnamed senior official from the Ministry of Finance told the news outlet:

The draft is ready and consultation is on with all the stakeholders…before coming up with the final paper. We expect it to be ready by September.

“The ministry has constituted an interdisciplinary committee under the chairmanship of Special Secretary (Economic Affairs) to examine the regulatory framework regarding virtual currency,” the publication detailed. “SEBI and RBI have expressed some reservations regarding clauses in the initial draft.”

How Should Crypto be Regulated?

The unnamed senior official was quoted by the New Indian Express, “Cryptocurrency is a new phenomenon and naturally, governments across the globe are struggling with it.” He further detailed, “Most of the officials have serious reservations against it, which all of us agree with … we want to arrive at a common conclusion. There must be an appropriate mechanism to regulate the same.”

Indian Crypto Regulation Ready by September: Official

While the regulators have not confirmed how cryptocurrency will be regulated, Quartz reported that a senior government official familiar with the matter indicated it could be regulated as a commodity. “I don’t think anyone is really thinking of banning it (cryptocurrencies) altogether. The issue here is about regulating the trade and we need to know where the money is coming from. Allowing it as (a) commodity may let us better regulate trade and so that is being looked at,” the publication quoted him saying on July 11.

He explained that cryptocurrency “trade is not a criminal offence,” describing:

What has to be in place is a mechanism to be sure that the money used is not illegal money, and to track its source is the most important thing.

Supreme Court Hearing Also in September

Indian Crypto Regulation Ready by September: OfficialThe Supreme Court of India on July 20 set the final hearing date for all petitions relating to cryptocurrency regulations to September 11. The hearing is in response to the circular issued by RBI on April 6 banning banks and all financial institutions under its control from providing services to crypto companies.

Many industry participants have petitioned against the ban. The IAMAI successfully convinced the supreme court to hear its petition on July 3. However, the court did not grant a stay and the ban went into effect on July 5. Banks subsequently closed the accounts of most crypto exchanges.

Judgement Day

The supreme court was supposed to hear all of the petitions relating to crypto on July 20. However, since some government bodies such as SEBI have not provided a response, the news outlet noted:

A three-judge bench headed by Chief Justice Dipak Misra acceded to the request made by the petitioners and the matter has been listed for final disposal on September 11.

At the hearing on Friday, the IAMAI was represented by Advocate Gopal Subramanium while Advocate Shyam Divan appeared for RBI. Divan “informed the court that allowing dealings in cryptocurrencies will encourage illegal transactions,” the publication conveyed, adding that he clarified the central bank’s policy is of “extreme caution.”

How do you think India will regulate cryptocurrency? Let us know in the comments section below.


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Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto Use

Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto Use

India’s central bank told the country’s supreme court on Friday that “allowing dealings in cryptocurrencies like bitcoin would encourage illegal transactions.” Other crypto petitions being heard include one asking the government to “take emergency steps to restrain the sale and purchase of illegal cryptocurrencies.”

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

RBI’s Argument

The Reserve Bank of India (RBI), the country’s central bank, appeared before the supreme court Friday to defend its position regarding cryptocurrencies. RBI issued a circular on April 6 banning financial institutions under its control from providing services to crypto companies.

According to the Economic Times, the central bank told the court:

Allowing dealings in cryptocurrencies like bitcoins would encourage illegal transactions and it has already issued a circular prohibiting use of these virtual currencies.

Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto UseRBI explained that crypto is “a stateless digital currency” that operates independently of a central bank such as itself, thereby “rendering it immune from government interference,” the news outlet noted.

The Financial Express elaborated that the central bank believes “it is necessary to regulate the bitcoin and other cryptocurrencies to check illegal transactions which will impact the international flow of funds.” Senior counsel Shyam Divan, appearing for RBI, reiterated that the central bank has a particular stance and other departments may have other positions.

Petitions Being Heard

Petitions against the RBI crypto banking ban are not the only ones that the supreme court is hearing. The Economic Times described:

Some petitions challenged the use of virtual currencies and alleged that they posed grave dangers to the traditional economy and they also sought framing of guidelines to regulate them … They also sought a direction for the Centre to take emergency steps to restrain the sale and purchase of illegal cryptocurrencies.

Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto UseThe Hindu pointed to one particular petition, filed by father and son Siddharth Dalmia and Vijay Pal Dalmia. “Mr. Dalmia, in his plea, has sought a direction to the Centre to take steps to restrain sale and purchase of illegal cryptocurrencies like bitcoins, which were being traded openly for ‘illegal activities’ like funding terrorism and insurgency,” the publication wrote.

The supreme court already heard the duo’s initial petition in November last year and subsequently issued notices to various government departments including RBI. The central bank responded at the time that it had warned people against the usage and risks associated with crypto. However, the Dalmias were not happy with RBI’s reply and filed a new petition, pointing out the inadequate action by the central bank.

At the hearing on Friday, the supreme court gave the government until September 11 to respond to all petitions.

What do you think of RBI’s view and action? Let us know in the comments section below.


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Indian Supreme Court Heard Crypto Petitions Today but RBI Ban Stays

Indian Supreme Court Heard Crypto Petitions Today But RBI Ban Stays

India’s Supreme Court heard the petitions against the crypto banking ban by the Reserve Bank of India (RBI) today. After hearing some arguments from both sides, the court decided to set another hearing date, allowing some of the regulators involved to respond to the petitions.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Supreme Court Hearing on July 20

Indian Supreme Court Heard Crypto Petitions Today But RBI Ban StaysThe long-awaited hearing at which the Supreme Court of India was scheduled to address all of the petitions against the crypto banking ban by the country’s central bank has finally taken place.

Today’s hearing follows the hearing on July 3 of the petition by the Internet and Mobile Association of India (IAMAI). The court did not grant a stay against the ban at that time. Last week, the central bank responded to a representation by the association but did not change its stance on crypto.

The latest chapter of the courtroom saga did not see an overturn of the ban. The court also did not hear all arguments by both sides. Crypto Kanoon, a platform engaged in crypto regulatory analysis, legal awareness and news, detailed:

Limited arguments were advanced on behalf of IAMAI and RBI today.

Another Hearing Date Set

Indian Supreme Court Heard Crypto Petitions Today But RBI Ban StaysThere are at least five writ petitions filed against the RBI ban. However, according to Crypto Kanoon, “SEBI [the Securities and Exchange Board of India] and few others have not filed their response to the petition seeking regulation…All (remaining) parties to file their reply within 4 weeks.”

Sohail Merchant, CEO of crypto exchange Pocketbits, commented on the outcome of today’s hearing:

Final hearing [is] slated for 11th of September. Now that is the Judgement Day.

According to lawyers familiar with the case, the central bank has been challenged on two grounds. They concern article 19(1) (g) and article 14 of the Indian constitution. The former “allows citizens to enjoy the right to carry on any occupation, trade, or business,” Quartz explained, adding that the latter “prohibits discrimination and mandates equal protection under the law for all.”

P2P Services Live

In response to the RBI banking ban, a number of crypto exchanges in the country have set up peer-to-peer (P2P) services.

Indian Supreme Court Heard Crypto Petitions Today But RBI Ban StaysKoinex launched its P2P platform called Loop on July 17. “Loop is a peer-to-peer fiat to crypto trading platform where registered users can trade in cryptos with other registered users in INR,” the exchange described.

“To ensure user safety, a built-in escrow system is employed which releases the cryptocurrency only after the seller double confirms the exact payment of the trade.” According to its website, the service currently offers the buying and selling of BTC, ETH, and XRP without network or transaction fees.

Last week, Wazirx launched its P2P service, also without network or transaction fees. The exchange recently claimed to have 125,000 users on its main platform after operating for four months. Meanwhile, Coindelta is also preparing to launch a P2P service called Flux.

What do you think of the Supreme Court hearing today? Do you think RBI’s ban will eventually be lifted? Let us know in the comments section below.


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Indian Central Bank Responds About Crypto Restrictions

Indian Central Bank Responds About Crypto Restrictions

India’s central bank has responded to a representation about its crypto banking ban. The Supreme Court gave the central bank seven days to reply following a hearing last week of the petition by the Internet & Mobile Association of India against the ban.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

RBI’s Response

Indian Central Bank Responds About Crypto RestrictionsIndia’s central bank, the Reserve Bank of India (RBI), has responded to a representation submitted by the Internet & Mobile Association of India (IAMAI), as directed by the country’s Supreme Court.

Nischal Shetty, the CEO of crypto exchange Wazirx, told news.Bitcoin.com that the representation is “a detailed document explaining blockchain, cryptos and how they function,” noting that it was “made with the belief that if the RBI gets a deep understanding of blockchain and crypto then they may go easy on the ban and think about regulations.”

Indian Central Bank Responds About Crypto RestrictionsThis representation was sent to the central bank on July 3 during the IAMAI petition hearing. The Court ordered the central bank to reply within seven days. On July 11, RBI finally sent its response to the association.

According to Sohail Merchant, the CEO of Indian crypto exchange Pocketbits, RBI’s reply is a “2 page generic response.” While stating that “as of now the response cannot be made public” but there is “not much to read though,” he commented:

IAMAI received the response from RBI as directed by SC [Supreme Court], the response is generic with the same language as the public circulars. They have not even given deliberate thought to the points made by us, all the basis of their arguments is ‘Investor Protection.’

Shetty reiterated, “RBI has responded to IAMAI…They aren’t changing their stand.”

Until Next Hearing on July 20

The central bank issued a circular on April 6 banning all financial institutions under its control from providing services to companies dealing in cryptocurrencies, including crypto exchanges.

Indian Central Bank Responds About Crypto RestrictionsRBI gave banks three months to sever their relationships with crypto businesses. As the ban went into effect on July 5, banks began closing accounts of crypto exchanges. One by one, the exchanges stopped supporting fiat deposits and withdrawals.

To bypass banking restrictions, a number of exchanges are launching peer-to-peer (P2P) trading services. Koinex and Coindelta are reportedly launching their P2P services on July 15. Wazirx, on the other hand, already launched its P2P service. The company wrote, “Wazirx P2P goes live today, 10th July at 3PM. With Wazirx P2P, a buyer and seller can buy and sell cryptos for INR directly with each other.”

Meanwhile, industry participants and stakeholders are trying to get the RBI ban lifted by filing petitions with the Supreme Court, which will all be heard on July 20.

Do you think RBI will soon lift the banking ban on crypto? Let us know in the comments section below.


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Indian Crypto Exchanges Launching P2P Trading Services – Bypassing RBI Ban

Indian Crypto Exchanges Launching P2P Trading Services - Bypassing RBI Ban

With the impending banking ban by the Reserve Bank of India, cryptocurrency exchanges in the country are scrambling to find banking alternatives. Two Indian exchanges have announced that they are launching P2P crypto trading services which will allow traders to buy and sell crypto legally even after the central bank’s ban.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Wazirx’s P2P Service

Indian Crypto Exchanges Launching P2P Trading Services - Bypassing RBI BanWith the banking ban by the central bank set to take effect on July 5, Indian crypto exchange Wazirx has been working on a solution for users to buy and sell crypto without needing a banking service.

The exchange announced last week that it is launching a P2P crypto transfer service which it claims to be “the most legal way to buy/sell cryptos in India after the RBI ban”. CEO Nischal Shetty described:

The buyer and seller can deal with each other directly while Wazirx acts as an escrow account for holding the cryptos during the transaction so that neither party cheats the other.

Wazirx releases the crypto to the buyer upon receiving a confirmation from the seller, he noted. “We verify the KYC details of every user before allowing them to trade on Wazirx, and keep a record of each and every transaction that occurs on our exchange.”

Indian Crypto Exchanges Launching P2P Trading Services - Bypassing RBI Ban

Launched in March, Wazirx currently supports the trading of 37 cryptocurrencies against INR and 17 BTC trading pairs.

Speaking to news.Bitcoin.com, Shetty shared, “we have 35 coins listed in just 3 months of launch”. With over 100,000 users currently, he added that his exchange is the “fastest to list those many coins in India in such a short span of time.”

Planning for RBI’s Ban

The P2P trading service will launch once the RBI ban takes effect, Shetty explained. According to the central bank’s circular, the ban prohibiting banks from servicing crypto businesses will commence on July 5.

“We will launch it whenever banks completely stop providing their services to crypto exchanges…tentatively 6th July but we’ll need to wait and watch,” Shetty told news.Bitcoin.com, noting:

People have been worried about how they would convert their fiat (INR) to crypto and vice versa. As soon as we announced P2P there was a big sigh of relief as users in India realized there are alternatives to the ban.

Five known petitions have been filed with the courts against the RBI ban. The supreme court will hear all cases on July 20, except for one petition which was filed by the Internet & Mobile Association of India (IAMAI). This petition will be heard on July 3. “After considering the urgency, the supreme court decided to hear this one out on 3rd which is before the RBI deadline,” Shetty detailed. Wazirx is a member of this association as are some other major crypto exchanges such as Unocoin and Zebpay.

Koinex’s P2P Service

Indian Crypto Exchanges Launching P2P Trading Services - Bypassing RBI BanAnother Indian crypto exchange, Koinex, also announced last week that it is launching Loop, “a peer-to-peer network for digital assets transactions using fiat currency”. The new service will be integrated into the Koinex web platform and the mobile app. Koinex users will automatically have access to it, co-founder Rahul Raj detailed, elaborating:

In conjunction with the crypto/crypto trading corridors on Koinex, the peer-to-peer transaction network will allow all users to exchange their fiat currency into a digital asset and vice versa without compromising on the seamless experience that they are used to.

What do you think of Indian exchanges launching P2P trading? Do you think RBI will find a way to stop this? Let us know in the comments section below.


Images courtesy of Shutterstock, Wazirx, Koinex, the Economic Times.


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New Party in Ukraine to Fund Itself Only with Cryptos

New Party in Ukraine to Fund Itself Only with Cryptos

A newly formed party in Ukraine has vowed to rely only on cryptocurrency contributions to sustain its activity and never to accept money from the oligarchs. Weakening state control over economy and expanding civil liberties are among its main political priorities. The party wants to protect the interests of people and companies from the IT sector, as well those of small and medium-sized Ukrainian businesses in other industries.

Also read: Ukraine to Compensate a Citizen in Bitcoin – for “Moral Damages”

Serious Ideas, Funny Faces

Several prominent Ukrainian bloggers have announced the formation of arguably the world’s first political party which will fund its activities exclusively through crypto contributions. The new right-wing, liberal political force, called “Democratic Horde”, intends to achieve its political goals mainly through Internet trolling, as stated on its website.

New Party in Ukraine to Fund Itself Only with Cryptos

According to its founders, the party will work to weaken state control over Ukrainian economy and fight to expand the civil liberties in the country, Forklog reported. The main PR-strategy comes down to “ruthless banter and playing with the images of modern pop culture”. Members of the party’s so-called “Orc-committee” are some famous Ukrainian bloggers – Yuri Gudimenko, Anton Shvets, Igor Shtedrin, Alexander Noinets, and Victor Tregubov. According to Igor Shtedrin:

It is better to carry serious ideas with a funny face than funny ideas with a serious face. It’s necessary to protect the interests of those who work, and not those who collect. Our world views, our methods differ from those of present day politicians. They live solely on money they get from the oligarchs. We have found a way to depend only on our supporters.

Shtedrin pointed out that “Democratic Horde” is world’s first party to consider crypto mining as an alternative to political contributions in fiat money. Its members have developed an application, which can be used by supporters to generate cryptocurrency “for the good of the party”. They will be mining “orccoins”. In the future, the digital tokens will also be used in voting within the party.

Petition Calls for Moratorium on Regulations

Members of the crypto community in Ukraine, and a number of Ukrainian officials, have called for legalizing cryptocurrencies in the country. Several bills have been introduced in the Rada, but no comprehensive regulations have been adopted yet.

A cybersecurity meeting in January discussed cryptocurrencies, and the National Security Council set up a working group tasked with finalizing the regulatory proposals. The country’s justice minister and the State Financial Monitoring Service have already expressed their views on cryptocurrencies. The parliament in Kiev, however, has not advanced towards adopting the necessary legal framework.

New Party in Ukraine to Fund Itself Only with CryptosMeanwhile, a petition calling on the government to refrain from regulating cryptocurrencies like bitcoin has been gaining support at Change.org. The author, a female Ukrainian user with the nickname Mary Lee, insists that it’s legally and technically impossible to regulate cryptocurrencies.

“Officials will once again regulate investors, traders, entrepreneurs, and ordinary crypto users, but they can’t regulate cryptocurrencies,” she says, calling to “Leave people and their money alone.”

Several other petitions have been collecting signatures in Ukraine. One calling for the legalization of cryptocurrencies was registered on the website of Ukraine’s presidency earlier this year. It needs 25,000 signatories to be accepted by the presidential administration. Another petition on the Change.org platform calls for setting up a working group to develop a comprehensive regulatory concept for the cryptocurrency market.

Do you believe that political and civic action can change the attitude of authorities towards crypto regulation? Share your thoughts in the comments section below.


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