India’s market watchdog suggests multiple regulator supervision for digital assets
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India’s regulator for securities and commodity markets has suggested that more than one regulator should monitor digital asset trading in the country. The Securities and Exchange Board of India (Sebi) and the Reserve Bank of India (RBI) have submitted a separate set of documents to a government panel in charge of preparing regulatory policy for the finance ministry to examine. A Reuters report, quoting an official it did not identify, said the government panel is expected to prepare its report by June. The RBI, which has continuously maintained a suspicious stance against digital assets trading, favors banning stablecoins. Stablecoins are pegged to certain fiat currencies, making them less volatile than digital assets. The RBI added that digital assets trading may result in a loss of income from money creation for central banks and bring about tax evasion. The central banks said that decentralized peer-to-peer transactions in digital assets pose fiscal stability risks as they depend on voluntary compliance. Sebi, on the other hand, has suggested that multiple regulators should monitor digital assets-linked activities instead of a single supervisor. It said it could oversee initial coin offerings (ICOs), manage digital assets classified as securities, as well as issue licenses for equity-market related products, while digital assets backed by fiat currencies could be administered by the RBI. Similarly, the Insurance Regulatory and Development Authority of India (IRDAI) and the Pension Fund Regulatory and Development Authority (PFRDA) could monitor insurance- and pension-related digital assets activities. The documents also proposed that investor complaints tied to digital assets trading could be taken up under India’s Consumer Protection Act. “Sebi’s proposal for multiple regulators to oversee the virtual digital assets (VDAs) sector represents a balanced and pragmatic approach. This move can ensure comprehensive oversight by leveraging the expertise of various financial authorities, thereby enhancing regulatory clarity,” Edul Patel, chief executive at digital asset investment platform Mudrex told CoinGeek. “It is a progressive stance…
Filed under: News - @ May 20, 2024 2:22 pm