INSUBCONTINENT EXCLUSIVE:
New Delhi: The Reserve Bank of India's (RBI) announcement on cryptocurrency has not only stirred the market but left both the traders and
investors in a state of loss with many of them thinking of wrapping up their operations
"This unprecedented move by the RBI has stirred the market and impacted the industry at various levels
The exchanges have witnessed a steep decline in daily trade volumes and price fall for all tokens
In addition, traders who were looking at long-term investment through crypto assets will suffer heavy losses, especially those who have made
hefty investments, out of their livelihood savings," Rahul Raj, Co-Founder and CEO, Koinex, told IANS.While Praveenkumar Vijayakumar,
Founder and CEO, Belfrics Global, said the announcement is an end of the road for many Indian exchanges and a clear letdown for new
investors, it is not going to have much effect on cryptocurrency transactions in the long run."As and when global prices advance, Indians
will find their way to get these assets through p2p (peer-to-peer) markets," he told IANS."Nowhere it is stated that cryptos are illegal
The only thing which has been stopped is banking service
If anybody can justify the cash amount for which they buy or sell the cryptoassets, the trading goes on," Bharat Verma, CEO and co-founder,
Pluto Exchange, told IANS.Last week, the RBI, in its first bi-monthly Monetary Policy Committee meeting of this fiscal, announced that
regulated entities already providing services to any individual or business dealing in digital currencies have been given three months to
exit the relationship."The RBI has cautioned on at least three occasions members of the public and users of virtual currency regarding risks
they are exposing themselves to through these cryptocurrencies," RBI deputy Governor B.P
Kanungo said."We have now decided to fence RBI-regulated entities from the risk of dealing with entities associated with virtual currencies
They are required to stop having a business relationship with entities dealing with virtual currencies forthwith, and unwind the existing
relationship within three months," he added."This move by the RBI might see an irreversible negative ripple effect across the ecosystem
So, overall, the mood in the market is dismal," said Rahul Raj.The industry stakeholders also rued the fact that they were not consulted
before RBI took its decision."Before taking this decision, industry participants were not consulted, public debates were not initiated and
public opinion polls were not undertaken
Even the findings of the committee were not published
The world is moving towards more efficient money and technology
We currently have billions of dollars being transacted in the form of cryptocurrencies, in a much more efficient and faster way than any
central bank in the world can perform," said Vijayakumar.Belfrics stopped its cryptocurrency exchange operations in India when the banks had
"Our blockchain technology division is very active in India as we serve government and private enterprises for blockchain-related
consultancy and product development," he added.Headquartered in Malaysia, the Belfrics exchange is currently active in Kenya, Dubai,
Malaysia, Singapore, Bahrain, Hong Kong, China and Indonesia."This knee-jerk move by the RBI has adversely impacted the industry, but the
directive has also given financial institutions a time frame to settle all the pending transactions with the exchanges
So, effectively, this time allotted can be used by traders to wisely transact on their crypto-assets
It is business as usual, at present," Rahul Raj said.He is also apprehensive that this move by the RBI might lure traders to do
under-the-table dealings or make small trade through direct cash transactions, which cannot be accounted or regulated."So, it might do more
harm to the existing market and lead to illicit practices and black market
We are hopeful that the government will allow a dialogue to resolve this situation," he added.But Verma is hopeful that RBI will give
detailed information and guidelines by the end of June
"It appears as a positive decision in market of crypto."Asked whether he plans to wrap up his business, Verma said: "I will wait for the
right thing and right time
Going out is an option too, but any decision right now will be too early to make.(This story has not been edited by staff and is
auto-generated from a syndicated feed.)
