Regulation of Cryptocurrency Exchanges in India
The
judgment of the Supreme Court on March 2020 quashing the Reserve Bank of
India’s (RBI) ban relieved many stakeholders in the crypto-ecosystem[1]. One
such player was crypto exchanges. Crypto exchanges or digital asset exchanges
essentially allow the user to buy or sell crypto assets (popularly known as
cryptocurrency[2]) using their fiat money like INR. Currently, there are around
400 known exchanges that globally trade digital assets including
cryptocurrencies. Unlike for any bank or financial institution, there are no
specific regulations for these exchanges in India.
A
well-known crypto exchange provides in its terms and conditions that it is not
a financial institution, bank, credit union, trust, hedge fund, broker or
investment, or financial advisor, and is not subject to the same laws,
regulations, directives, or requirements applicable to such persons. Further,
it is merely a technology platform and the user is solely and entirely
responsible for the legal, regulatory, and tax compliance of all transactions
carried out by the user.
Tatva Legal, Hyderabad has an experienced team of
corporate lawyers who, amongst other services, advise on niche areas of law
involving crypotocurrency,
blockchain technology, AI and machine learning and other such areas involving [TL1] information
technology law.
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