No Place For Cryptocurrencies In India’s Fintech Sandbox Framework?

It has recently come to light India, the second most populated country in the world, which obviously has the potential to provide a good market for any given product, has excluded excludes cryptocurrencies from their fintech sandbox framework. This intel is based on the latest reports released by the reserve bank of India (RBI) and is definitely bad news for cryptocurrency enthusiasts from the country as well as worldwide.

The document which has been available online since yesterday elaborates on the way in which the regulatory sandbox will be applied to the local fintech sector under the strict watch of the RBI. The goal of this will be to “increase efficiency, manage risks and create new opportunities for consumers”. Even though this move is in order to increase flexibility and dynamism in the sector, the condition 6.3 of the document is a clear setback to one of the areas which is indeed showing some of the greatest developments when it comes to innovation. Sandbox testing will thus not be inclusive of cryptocurrency services, like trading, investing and ICO´s.

However, that being said, a sliver of hope remains in the regulation, as it appears to leave a backdoor open for crypto entrepreneurs in case “the applicants can show that either a different technology is being gainfully applied or the same technology is being applied in a more efficient and effective manner”.

The latest references to cryptocurrencies in Indian regulation have ensured that the authorities in the country get labelled as one of the strictest and toughest when it comes to the cryptospace. India has been struggling for quite some time now to figure out their appropriate structure in order to regulate the entire ecosystem and the fintech regulatory sandbox framework which was released today by India’s central bank released explicitly excluded crypto. This is a shame when most other governments are starting to take the crypto market seriously and enforce suitable regulations.

Rishma Banerjee

Rishma is currently pursuing a bachelor’s degree in International Relations and has a special place in her life for sifting through all sorts of random trivia, thank you very much.