Indian banks ‘want clear crypto regulations’

Institutions are interested in use cases such as international transactions but require greater legal clarity

Indian banks ‘want clear crypto regulations’
Image: Cointelegraph

In an interview on Friday, the head of research at Blockchain.com said Indian banks are interested in cryptocurrencies but are cautious about getting more deeply involved in the space because of ongoing regulatory uncertainty.

Speaking to Data Quest, Garrick Hileman also hinted that Blockchain.com still does not have a payment gateway in India for the same reason. It is, however, a goal for the firm, he added.

Earlier last week, during a webinar on Indian regulations, the CEO of WazirX exchange, Nischal Shetty, highlighted the fact that Indian banks were interested in getting involved in the blockchain and cryptocurrency space, Cointelegraph reported. He said that the banks approaching WazirX to seek advice seemed specifically inclined towards exploring the technology’s use case in international transactions.

India risks falling behind

In the past two years, India has already witnessed many blockchain and crypto businesses going bust due to the lack of clear regulations and banking support. However, the Supreme Court’s decision to revoke the Reserve Bank of India’s banking ban has had a positive impact on the crypto business in the country.

Addressing the same issue, Hileman said that while there has been some progress since the ruling, there are other regulatory bodies that still do not want crypto to be a part of the Indian financial marketplace.

Once these bodies accept cryptocurrencies and bring supportive regulations, India will “see a proliferation of business, banking relationships, entrepreneurial activity, investment growth,” he stated. 

According to Hileman, the present stance of Indian regulators threatens India’s growth in this fast-evolving space, and “India risks falling behind other tech hubs that are taking a more positive view about the multiple benefits of cryptocurrency innovation.”

Not all officials are convinced

There are still hardline anti-crypto officials in India. The former finance secretary of India, Subhash Chandra Garg, has previously introduced the idea of banning cryptocurrencies outright.

In a recent webinar with industry experts, Garg said that the ban would only forbid cryptocurrencies insofar as they functioned as currencies. They would still be available for trade and investment, much as commodities, but must be regulated in a similar fashion.