The president of the National Association of Software and Services Companies (NASSCOM) Debjani Ghosh has publicly announced to Indian citizens that cryptocurrency is illegal, reports local news outlet The Hindu.
Under pressure from the Reserve Bank of India (RBI), Indian lawmakers passed a ban on banks conducting crypto-related business earlier this year, much to the frustration of local traders. There has since been confusion among India’s citizens on whether or not concurrency itself is still legal within the country.
The public has since turned to NASSCOM for greater clarity on the crypto ban, with investors wanting to know if police action might be taken against those still holding crypto or trading in black markets.
“It is law of the land and hence, we have to work with it,” said Ghosh. “If we do not agree, we have to go back to the government and speak about why cryptocurrencies aren’t correct [sic].”
NASSCOM’s perception that cryptocurrency is in fact illegal across the board has come as a disappointment to Indian investors. Many have made the case that this is a failure on the part of the government to support innovation.
“The genesis of this problem, however, lies in the failure of policy making not keeping pace with rapid technological changes,” said Ghosh. “Nasscom’s focus would be to say, how do you synergise technological development and policy making. I think that will be our focus.”
Public concern over India’s crypto ban reached new heights when Sathvik Viswanath and B V Harish, founders of Unocoin, were recently arrested for opening a Bitcoin ATM. Authorities stated that the company “had not taken any permission from the state government and is dealing in cryptocurrency outside the remit of the law.” One police official told the Times of India that the central bank considers cryptocurrency “illegal.”
NASSCOM had not yet looked into the incident, said Ghosh.
The Indian Supreme Court has yet to budge on its stance against crypto, despite a wave of petitions from disgruntled traders. The RBI has impressed upon Indian lawmakers that allowing for cryptocurrencies like Bitcoin to be freely traded would encourage illegal transactions, money laundering and other illicit activity. Data protection is also a concern, but Ghosh believes that crypto needs a more flexible regulatory framework to create a space for carrying out necessary experimentation.
“Such experimentation will create create space for a bit of experimentation because, even the government at this stage, will not be knowing how technology will play out and know what is right and what is wrong,” said Ghosh.
Since the July ban, many crypto startups have fled India. Major crypto exchange Zebpay, was forced relocated to the “Blockchain Island” of Malta due to government pressure.
Ghosh concluded her statement by reminding startups that although it is tempting to ignore legal issues, that they should not forget to pay attention to what is happening in government. She predicts that the digital money economy is going to see even more regulation in the months to come.