The Indian government has invited a law firm Nishith Desai Associates to present suggestions on cryptocurrency regulations in India. The invitation came in response to the firm’s submission of a proposed regulatory framework for cryptocurrencies, reported news portal Bitcoin.com.
The paper titled, ‘‘Building a Successful Blockchain Ecosystem for India: Regulatory Approaches to Crypto-Assets’, include suggestions that the firm would like to present to a ‘High-Level Committee’ which is working on the devising an appropriate legal framework with regard to crypto-assets, also referred to ‘cryptocurrencies’ or ‘virtual currencies’.
In brief, the paper chiefly touched on topics such as regulation not prohibition; three types of crypto-assets; regulatory approaches. For instance, while suggesting regulation instead of prohibition the paper says, “An outright ban on crypto-asset activity should not be considered for several reasons. Crypto-assets are essential to blockchain technology, which is a new and disruptive technology that presents both benefits and risks. History has taught us that such technologies should be regulated and not banned, since banning is likely to be counter-productive and may also suffer from legal infirmities. Rather, in line with international consensus, a balanced regulatory approach should be taken to promote the various benefits of the technology and mitigate the risks.”
The paper also referred to the recent news item which suggested that the committee might be considering a ban on cryptocurrencies. The news which was also covered by Crypto-News India, had said, some unknown government panel had advised lawmakers to restrict its operations in the country. However soon after that, reports revealed that India may regulate cryptocurrencies, instead of banning them.
This is not the first time that the firm has submitted a proposal for cryptocurrency regulations. In 2017, when the Inter-Disciplinary Committee was chaired by Dinesh Sharma, the firm had submitted a paper titled, ‘Draft Code of Self-Regulation
for Virtual Currency Businesses in India’.
The paper suggested that the Committee may consider self-regulation backed by a statutory mandate in order to provide statutory backing to the norms, and in turn, facilitate a system of government oversight of the industry.
We reached out to the law firm for a comment. We’ll update the story as and when they respond.
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