INSUBCONTINENT EXCLUSIVE:
Governments across the world abhor the virus of disruption
Their regulatory antibodies are quick to take down agents of radical change
Unless the disruption sneaks inside undetected
In 1990, the internet was available in select American cities
The result is, today we are a the cusp of 500 million internet users
India is one of most data-hungry countries in the world
The next wave of seismic change will come from blockchain and cryptocurrencies
Their transformative and economic credentials are there for all to see
The opportunity is open to lead this revolution
The impact is not limited to the financial system but spreads to the innovation pipeline in the underlying blockchain technology
If it keeps going down this path, India will likely will be playing catch-up when blockchain and crypto assets move from being shiny new
Sure, blockchain and crypto are different ideas
governments and traditional institutions grappling with the potential end of the status quo on one side, and the crypto community on the
at odds with the realities of the world
Moreover, this claim of moral superiority is marred by the presence of fly-by-night operators who run Ponzi schemes around cryptocurrencies
By not embracing public oversight, legitimate crypto investors are tarnished by fraudulent ones, and crypto investors are far less certain
Consultants, a blockchain company based in the US, is oscillating between the first two buckets described above
It is looking at cryptocurrencies with plenty of suspicion while not entirely discounting the transformational nature of the underlying
idea.
R Gandhi, former deputy governor of the RBI, calls it a neutral, nonconclusive position
The challenge for any regulatory authority is to find an appropriate tradeoff between the competing objectives of mitigating the risks from
a particular innovation and allowing market participants to harness the benefits of that innovation, says a spokesperson of the European
The eventual aim is for the EBA to identify whether any regulatory action is required to ensure that market participants can have confidence
from the foundation of blockchain
It sees crypto investments as an inherently volatile concept that investors need to be shielded from
But it is also examining the possibilities that blockchain as a platform offers
But the two are not exactly mutually exclusive.
Daniel Wang, who runs Loopring, an open-source software platform for decentralised exchanges
And only value networks drive new business behaviours and potentially change the way we do business
Countries that are not open to blockchain networks will lose their competitive advantage in the long run
a leader in the technology.
The Trading ConundrumThe current regulatory direction also means India will miss out on an emerging
multibillion-dollar asset class
the possibility of individual investors participating in initial coin offerings (ICOs)
Conceptually, a well-regulated ICO system can protect investors while opening up wealth-creation opportunities and offering a new way of
Instead, it decided to beef up regulations
Several exchanges, including Zebpay, Unocoin, CoinSecure, BuyUcoin, and BTCX India, are reportedly looking to move their operations to
trade in one day and has over 50,000 KYC-registered customers
Koinex, another crypto exchange, claims it is still seeing 500 new sign-ups every day on its platform.
Rahul Raj, cofounder of Koinex,
without disclosing what his next step would be, says he is still hoping for the tide to turn
We did not want them to move to global exchanges for trading
says.
Alluma.io, a new exchange, strikes a bolder tone
In the context of demonetisation and the interlinking of Aadhaar to financial products and bank accounts, it is clear the government wants
greater control over the economy and how people participate in it
could have greater control over a virtual currency than a paper one because it would be able to keep a tab on all transactions recorded on
the blockchain ledger.
This partially explains why several governments are interested in cryptocurrencies, even if their vision might be
They need to know the technological requirements
The best course of action is to decisively lean towards the US model of innovation with sandboxed regulation rather than stay paralysed by
