Cryptocurrencies or digital tokens should be treated as securities of a special class to which the provisions of existing securities regulations will not apply, and a new set of regulations appropriate to the context should be evolved and applied, industry body CII said in a statement.
This would mean regulatory focus on dealings and custody, rather than on issuance (except where issuance entails an initial coin offering to public by an issuer established here), Confederation of Indian Industry (CII) said. Centralised exchanges and custody providers that may be established in India, must be required to register with Sebi and to adhere to KYC and AML compliance requirements that apply to financial markets intermediaries, it said. It also recommended extending treatment of crypto/digital tokens as ‘securities’ of a special class.