The IAMAI-Blockchain and Crypto Assets Council on Tuesday said it has set up a self-regulatory code of conduct that will see all crypto exchange members voluntarily complying with KYC, tax and other norms.
A formal board comprising eminent jurists, technical specialists and fintech compliance specialists is also being set up to oversee the implementation of this self-regulatory code, a statement said.
Blockchain and Crypto Assets Council (BACC), which has been set up under the aegis of the Internet and Mobile Association of India (IAMAI), welcomed the RBI's advice to banks against using its 2018 circular that called for non-acceptance of crypto-related transactions of customers.
"The association hopes that with this clarifications given by circular RBI/2021-22/45, all speculations that banks are stopping transactions from June 6, 2021 will be put to rest," IAMAI-BACC said.
The RBI circular also suggests that certain mandatory checks such as KYC (Know Your Customer), AML (Anti-Money Laundering), CFT (Combating the Financing of Terrorism), PMLA (Prevention of Money Laundering Act) and FEMA (Foreign Exchange Management Act) should be carried out on the accounts.
"The IAMAI-BACC believes that such checks are necessary and must be carried out. On its part, the crypto exchange members of the association have set up a self-regulatory code of conduct for its members...
"In parallel, IAMAI has also suggested that the government should regulate crypto assets through an act of parliament," it said.
IAMAI-BACC noted that with 15 million users and upwards of Rs 10,000 crore held by small investors, India is among the top players globally in the crypto market.
"...for the welfare of the users, it is very important that crypto assets are regulated. This is a good move by RBI and a positive news for the crypto industry.
"It is a good sign that India is moving towards more acceptance and awareness amongst the mainstream markets and regulators and would help in shaping the crypto-assets market," it added.
Members of IAMAI-BACC will work together with customers, markets and regulators for the establishment of ethical and professional standards for crypto industry, it said.
Nischal Shetty, founder of WazirX and IAMAI-BACC member, said RBI's move brings in a lot of clarity for the banks.
"They've been on the fence whether they should service the crypto industry or not. Now there's clarity that will help banks provide services to crypto industry," he added.