Taking a dramatically different stance from the RBI and Finance Minister Arun Jaitley, SEBI Chairman Ajay Tyagi has said that Bitcoins, and cryptocurrencies in general, cannot be ignored.
Observing that virtual currencies have not posed any systemic risk to the economy, Tyagi stated that a government panel is currently looking into the much-debated topic of cryptocurrency regulation.
During a recent financial markets summit organised by the Confederation of Indian Industry (CII), Tyagi said, “On the issue of Bitcoins, the government is looking into it in consultation with the RBI and Sebi. The panel, also consisting of finance and information technology ministries, is looking into what to do about it.”
According to the Chairman of the market regulator, however, blockchain should not be lumped with cryptocurrency, which tends to be unstable with some even terming its increasing popularity as a “bubble”.
Blockchain, on the other hand, is a useful technology that should be encouraged by the government, added Tyagi.
The development follows the RBI’s recent warning about the of cryptocurrencies. In its statement, released on December 5, 2017, the country’s central financial institution stated, “Attention of members of public is drawn to the press release issued by the Reserve Bank of India (RBI) on December 24, 2013, cautioning users, holders and traders of Virtual Currencies (VCs) including Bitcoins regarding the potential economic, financial, operational, legal, customer protection and security related risks, associated in dealing with such VCs.”