Bitcoin economy in India at the moment would be the creation of a self-regulatory body rather than burdening regulators like the Securities and Exchange Board of India (SEBI), according to Sandeep Goenka, co-founder, Zebpay, India’s largest Bitcoin exchange.
In the beginning, because there are so many changes happening to the industry and it is very difficult for the government to follow, they can simply allow us to form a self-regulatory organisation (SRO) on the lines of the Mutual Fund Association of India, Internet & Mobile Association of India, or the Payment Council of India,” Mr.Goenka said in an interview.
“SEBI also started as a self-regulating organisation. They themselves created the regulatory structure which after many years became an official regulatory body,” he said.
While Bitcoins and other crypto-currencies are currently not regulated in India, the government is considering various options, including banning such currencies, or allowing them to be transacted under the regulation of SEBI.
Mr.Goenka said the government should not consider banning Bitcoins as they are increasingly being used as store of value. The Bitcoin trade on Zebpay has risen from ?100 crore per year as of last year to ?200 crore per month this year.
Zebpay currently accounts for 70% of the Bitcoin market in India and trade on their exchange shows a rapid increase in the demand for the crypto-currency in India, he said.
However, Bitcoins in India are still viewed as investment options rather than as a currency, like it is in countries like South Korea. This brings with it the added complication of how to regulate it—as a currency or as a stock.
In 2010, a Bitcoin was worth only Rs 5, which quickly rose to Rs 30,000-40,000 last year, and now it is at Rs 175,000, according to Mr Goenka.
US dollar or Indian rupee, the bulk of the currency is being used for normal, legal transactions,” Mr Goenka said. “It is only a small fraction that is being used for illegal operations. It’s the same for Bitcoins. For most people in the world, it is used for potential investments.”said Zebpay Goenka.And industry people wants bitcoin to be regularize and it will be create more employments in this industry.