NASSCOM, one of the largest trade associations in India, is pushing for cryptocurrency regulations in the country. In a recent report, developed jointly with management consulting firm Avasant, NASSCOM has urged the government to rethink its cautious regulatory approach towards cryptocurrencies.
The association has highlighted the impact of the regulatory uncertainty and the RBI banking ban in its report. Some of its key observations include:
- The current regulatory landscapearound cryptocurrencies and digital assets have handcuffed several industry participants in India, not allowing them to take full advantage of blockchain technology.
- VC investment is flowing into blockchain startups worldwide, but Indian projects have just seen $8.5 million worth of VC investments which accounts for only 0.2% of the total global investment. Initial VC investments were in exchanges such as Zebpay and Unocoin which have been squeezed by the RBI banking restriction. The regulatory environment has limited investment opportunities for cryptocurrency-based startups.
- The conservative approach by the government has led to a mass exodus of entrepreneurs to crypto-friendly jurisdictions such as Malta, Switzerland and Singapore.
- The lack of access to banking channels has resulted in the shutdown of prominent cryptocurrency exchanges in the country.
It is good to see an association like NASSCOM pushing for positive cryptocurrency regulation in the country. NASSCOM’s report can have a big impact on the government as it engages with them on various levels. The association has called for a consultative effort by the government on cryptocurrency regulation where it engages with key stakeholders in the industry. Let’s hope that the Indian government pays attention to NASSCOM and accelerates efforts towardsa progressive regulatory framework that can stir more growth and investments in the blockchain industry.
(Thumbnail Image Credit: Tech in Asia)