SEBI recommends regulators to oversee crypto trade, RBI still sees ‘macro risk’

livemint.com:

India's market watchdog has recommended that several regulators oversee trade in cryptocurrencies, documents show, the strongest signal to date that at least some authorities in the country are open to allowing the use of private virtual assets.

The position of the Securities and Exchange Board of India (SEBI) contrasts with that of the Reserve Bank of India (RBI), which maintains that private digital currencies represent a macroeconomic risk, separate documents show.

Both sets of documents, which have been seen by Reuters, have been submitted to a government panel which is tasked with formulating policy for the finance ministry to consider. SEBI's stance has not previously been reported.

Also Read: The curious case of India’s first crypto mutual fund

India has taken a tough stance against cryptocurrencies since 2018, when the central bank prohibited lenders and other financial intermediaries from dealing with crypto users or exchanges though the move was later struck down by the Supreme Court.

In 2021, the government prepared a bill that would have banned private cryptocurrencies though it has not been introduced. Last year, when it was president of the G20, India called for a global framework to regulate such assets.

The RBI remains in favour of a ban on stablecoins, according to a person with direct knowledge of the panel's discussions. The person, who was not authorised to speak to media and declined to be identified, added that the panel plans to firm up its report as early as June. Stablecoins are cryptocurrencies designed to maintain a constant exchange rate with fiat currencies so that they are less vulnerable to wild volatility.

In its submissions to the government panel, however, SEBI recommended different