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DAILY CURRENT EVENTS CIVILS360

November 1, 2017

Crypto currencies now come under SEBI lens

  • The rising popularity of crypto currencies and the increasing number of entities looking at raising funds through Initial Coin Offerings (ICO) has caught the attention of the capital market regulator, which is evaluating whether such instruments and offerings can be brought under its regulatory purview.
  • According to persons familiar with the development, the Securities and Exchange Board of India (SEBI) is mulling whether an ICO can be regulated under the existing legal framework or certain amendments would be required in case the government wants the capital market watchdog to be the regulatory authority for such issuances.
  • Incidentally, crypto currencies like bitcoin, ethereum and such offerings have been under government radar for long and discussions have been held between various bodies, including SEBI and the Reserve Bank of India (RBI), on the possible ways in which this segment can be regulated. The central bank is of the view that these instruments are securities and so SEBI should be the regulating body.
  • An ICO, like an equity initial public offer (IPO), is an issuance of digital tokens that can be converted into crypto currencies and are mostly used to raise funds by start-up firms dealing in blockchain technology and virtual currencies like bitcoins and ethereum.
  • Unlike an IPO, which is governed by SEBI regulations, there is no regulatory body for ICOs in India.
  • According to a recent study, more than 2,500 Indians invest in bitcoin daily. Start-ups like Zebpay, Unocoin, Coinsecure, Searchtrade, Belfrics and Bitxoxo are some of the well-known players in the bitcoin and blockchain segment in India.
  • Crypto currencies and ICOs have risks and involve pooling of money, it cannot be regulated by SEBI unless it is relatable to the securities market. “Bitcoins are neither ‘commodities derivatives’ nor ‘securities’ under Securities Contracts (Regulation) Act, 1956. Amending definition of ‘securities’ alone may not resolve the issue of bitcoin regulation as there are numerous issues revolving around,” said Mr. Agrawal.
  • Bitcoin players, meanwhile, feel that instead of a regulator, the industry is in more urgent need of a self-regulatory organisation (SRO) that could formally lay down principles to take care of concerns like money laundering and other possible misuse.

‘Doing Business’ rank: India jumps 30 places

  • India climbed 30 positions in the latest ease of doing business ranking by the World Bank, in its Doing Business 2018 report released on Tuesday. The report ranks India at 100 among 190 countries. Last year, India was ranked 130.

Trump to push for ‘open Indo-Pacific’

  • U.S. President Donald Trump will “present the U.S. vision for a free and open Indo-Pacific region” in a speech in Da Nang, Vietnam on November 10, at the Asia-Pacific Economic Cooperation (APEC) CEOs meet, the White House said on Tuesday.