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India’s Reserve Bank of India denies participating in the plot to ban cryptocurrencies

Arijit Sarkar



Cryptoverse questions India's stand on crypto ban following RBI's response
Credit: Wikimedia

Despite talk of India leading the tech revolution and the ‘Digital India’ campaign, the present government remains hesitant about embracing cryptospace. Consequentially, several crypto-businesses have either tasted the dust or found shelter in crypto-friendly countries such as Australia.

While there have been efforts online to bolster India’s hand in the cryptocurrency revolution, “Team blockchain lawyer” filed a Right to Information (RTI) application regarding the the proposal to ban cryptocurrencies on May 7, 2019. The application was based on a local news article that claimed that the government was considering a ban on cryptocurrencies. A similar application was previously filed by Coin Crunch. However, that did not receive any response.

Reserve Bank of India (RBI) has provided a written response to the recent RTI application, an update that was verbally shared on Team Blockchain’s YouTube channel. Shocking the entire Indian crypto community, the host read RBI’s response as,

“They (Reserve Bank of India) have not received any communication from any department nor have they given any communication to any government department pertaining to drafting of this bill.”

While RBI clarified its non-involvement in drafting crypto-related bills, the organization’s website has been proactively sending out preventive notifications toward crypto-assets for Indian investors. Some of the other departments within the Indian government such as Department of Economic Affairs (DEA) and the Central Board of Direct Taxation (CBTD) had previously endorsed the idea of “completely banning the sale purchase and issuance of all types of cryptocurrencies.”

Despite the RBI denying any involvement in drafting India’s crypto-bill, controversies around the crypto-ban are starting to stir. Following the news, WazirX CEO Nischal Shetty tweeted,

“RBI says it has no knowledge of any such bill about crypto ban. Is the bill even real or has there just been fake news being spread? 🤔

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ErisX goes all hands on deck to launch a Bitcoin Futures market




ErisX goes all-hands on deck to launch a Bitcoin Futures market
Source: Unsplash

ErisX’s CSO, Matt Trudeau, detailed the company’s four important plans for the future, which includes launching a spot market, to secure a Bit License, DCO, and to launch a futures market.

ErisX currently has a DCM contract, which is a Derivative Contract Market that allows ErisX to run a CFTC-regulated futures exchange. However, ErisX aims to get a DCO [Derivatives Organization], which will effectively allow it to run a CFTC-regulated clearinghouse. A clearinghouse would mean that ErisX can take control of the custody of the assets and clear and settled trades.

The CSO explained the benefit of this, stating,

“There is some efficiency for firms like producers [like mining companies]; if they need to hedge their inventory or need liquidity on a spot market, they could do that conveniently on a single platform. “

Trudeau added that from the “post-trade standpoint” and “the collateral management standpoint,” ErisX would have cash, crypto, and the futures, all stored in their clearinghouse. This would boost efficiency since it would be available for all customers under a single platform. The CSO added,

“… so there is some efficiency in terms of managing collateral, if you don’t have assets on  multiple platforms, it can all be in our clearinghouse.”

Apart from the aforementioned plans, Trudeau added that the crypto-industry needs to mature more and that ErisX plans to make a significant contribution to that. He added,

“The market is professionalizing and we think that in terms of what institutions are expecting from a trading/custody experience, we will bring some of the solutions to the market and that’s really the foundational pieces that they are looking in order to build their businesses on top of us.”

Apart from ErisX, LedgerX has also received a go-sign from the CFTC to settle Bitcoin Futures in Bitcoins. Other exchanges include Intercontinental Exchange’s Bakkt and Seed CX.

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