The buzz is that India may have laws regulating cryptocurrencies by next year. Will such a move benefit the asset and the investors? Outlook Money spoke to Nischal Shetty, founder and CEO of cryptocurrency platform WazirX and member of Blockchain and Crypto Assets Council (BACC) to discuss why a law on cryptocurrency is needed in India and how it will affect the asset and the investors.
Why is a law for cryptocurrency needed in India?
Cryptocurrency is a combination of finance and technology, so whenever there is finance, it’s always good to ensure some level of user protection, and have some guidelines… These are not present in cryptocurrency (as of now).
Globally, every country is promoting this new technology. At the same time, they have tried to ensure that none of the negative factors affect the innovations. To do that, regulations seem to be the right step.
Will rules and regulations affect crypto’s popularity?
There are millions of people who are not participating because the crypto market is not regulated. There are also a lot of startup founders who are afraid to invest in cryptos. They want some kind of regulatory oversight before they get in.
So, the right regulations will push this industry forward faster. But over-regulation or wrong regulations can have a negative impact on this industry. But overall, rules and regulations will make this industry more popular.
What is the future of crypto as an asset in India?
We are adopting cryptos as an asset not just in India, but globally as well. There are various benefits of crypto as an asset. For the first time, we have access to an asset class that has global liquidity. Second, it is accessible from a mobile phone and internet. Third, it is something that you can own as your own.
I believe that India will become the top crypto-holding nation. Any asset in a physical form is difficult to hold. But crypto assets are digital and can be ‘held’ easily.
Is there an investment strategy one can follow for cryptos?
Before you buy anything, do your research and start slow. Do not spend the whole 'X' amount in one go; try to spread it. In that process, you will also learn. As crypto is very volatile, you should be aware of its cons.