NEW DELHI: As the Centre is looking at regulating cryptocurrency, the Parliamentary Standing Committee on Finance wants finance ministry officials to appear before it and explain who will be regulatory authority for the cryptocurrency players and how the Centre is planning to follow to regulate the industry which defies the definition of standard “industry” or “assets” or “technology”.
The committee headed by BJP leader Jayant Sinha met leading players and representatives of the cryptocurrency players on Monday and asked them to explain their functionality, risk to investors and internal regulations.
The majority of the committee members were not in favour of a blanket ban on cryptocurrency. But they agreed that the sector which claims to have “crores of Indians invested over `6 lakh crore in crypto assets,” must be regulated and should be brought under tax net.
However, it ruled out to recognising it as a legal tender.
“...Largely they agreed that there cannot be a blanket ban. But many concerns were raised and everyone agreed on the need to regulate it. But there were many queries which remained unanswered. The most important was if regulated, who will be the regulator of the sector which is neither currency, nor traditional trade not just technology. That line has to be defined. This was not conclusive and in our next meet we will ask finance ministry officials to be present and explain some of our queries and concerns,” a source, who was present in the meeting, told TNIE
The committee also raised concern over full-page “misleading advertisement” and also the mechanism to safeguard investors as currently, it is just like a ponzi scheme, open for frauds, and susceptible to be used for illegal and criminal activities.
According to Jayant Sinha, apart from the regular players, the committee had called “stakeholders from across the industry including operators of major exchanges, members of CII as well as academics from IIM Ahmedabad”.
Players to explain functionality, risks
The committee met leading players and representatives of the cryptocurrency players and asked them to explain their functionality, risk to investors and internal regulations.