Crypto Players In Talks To Create New Blockchain Council After IAMAI Distances From Industry

Following the dissolution of the Blockchain and Crypto Assets Council (BACC) by the Internet and Mobile Association of India (IAMAI), crypto exchanges and blockchain companies are trying to band together to build an independent think tank to further concerns within the sector.

According to an ET report, crypto and blockchain players are in preliminary talks to form an independent association and are busy finding a ‘common ground’.

Last week, IAMAI dissolved BACC over an ‘uncertain regulatory environment’. It has stated that the association would like to utilise its limited resources for other emerging digital sectors. But it aims to make continued contributions to segments within the blockchain like the promotion of Central Bank-issued Digital Currency (CBDC).

The industry reportedly believes that there were tensions between IAMAI and BACC over the fact that the former was not pushing their concerns and cause enough. IAMAI, on the other hand, felt that the crypto players needed to do more in terms of compliance with government regulations. Reports suggest that IAMAI wants to distance itself from the crypto industry.

As reported by Inc42 earlier, IAMAI was unhappy with the exchanges not complying with codes of conduct set up internally and disagreements between the association and blockchain founders have only grown. 

One of the contested points was that the exchanges only processed the pulling down of TV and digital commercials promoting crypto investing timely. Other than that, there have been constant struggles between the government and crypto players, who are not properly following the demands and requirements of the government decided during the meetings with bodies. Thus, in terms of compliance, IAMAI does not want to be associated with the industry or discussions going forward.

Crypto Industry Looking East If Concerns Not Addressed?

One of the points raised by the crypto firms according to the ET report is that the top five crypto companies provided most of the funding to BACC. Yet, they weren’t deriving any ROI.

The industry players are now looking at a council comprising not only players from the country but also a mix of academia, research scholars and influential people within the Web3 ecosystem. The council aims to facilitate a talk between the Indian government and industry players to create a level playing field between business and regulation.

It is also noteworthy that due to India’s stance on the blockchain ecosystem, several Indian crypto founders have shifted their base to Dubai or Singapore, where the regulations are not a constant warzone. 

The crypto startups have been marred by a slew of regulations such as the imposition of a 30% tax on income from virtual digital assets (VDAs), a 1% TDS on transactions of more than INR 10,000 and the talks to introduce GST on crypto income, too. 

When the industry started using UPI on the apps, the government distanced itself from the same, shutting down their easiest mode of P2P payments. Anti-money laundering squad has also been after the crypto exchanges, probing their alleged role in such activities. Crypto income is also likely to be brought under the auto information exchange between India and 100+ nations.

Currently, the Telangana IT minister has offered support to the crypto founders to take their issues to the central government. He stated that he would be happy to work with the crypto industry and its leaders who are migrating to Dubai and other places, to sit with them and have a conversation with them.

It remains to be seen how the industry stakeholders work out their need for an independent and self-regulatory council.