Indian Startups Lobby For Virtual Currencies
Digital Asset and Blockchain Foundation of India (DABFI)
In the wake of last week’s decision by India’s government to form a committee to examine virtual currency, some of the country’s leading Bitcoin startups are lobbying to showcase the effectiveness and potential of cryptocurrencies. The Digital Asset and Blockchain Foundation of India (DABFI) was launched in February 2017 by Bitcoin startups Coinsecure, Searchtrade, Unocoin, and Zebpay, and functions as a self-regulatory body that seeks to create awareness of cryptocurrencies by assisting with the establishment of anti-money laundering standards, building global relationships, and remaining proactive in the international cryptocurrency community.
"This organisation aims to drive education and create market for blockchain and bitcoin in the Indian market which is now on the path of digital economy. Our vision would be to work with regulators and develop strong framework for our industry to provide required impetus for the growth of the industry,” said Saurabh Agrawal, CEO of Zebpay.
The DABFI was formed out of concerns for the Indian government’s growing skepticism toward cryptocurrency use within India. Cryptocurrencies have been in the crosshairs of Indian authorities since December 2013; however, recent decisions by regulators have created added pressure to the situation. In November 2016, India took the first steps toward demonetization by denouncing the use of 500 and 1000 rupee banknotes. As a result, bitcoin use increased and since then, Indian authorities have responded with contempt.
In March 2017, Kirit Somaiya, a member of the country’s right-wing Bharatiya Janata Party, denounced the increased use of bitcoin when he proclaimed the virtual currency as “Pyramid Ponzi Scheme” and “hypothetical currency.” He further suggested that the Reserve Bank of India should prohibit the use of virtual currencies. The politician’s outcry led to dubious reports by the Indian news outlets that cryptocurrencies were declared “illegal” by the Indian government. This caused an uproar within the cryptocurrency community. Zebpay responded to the madness with a blog post, clarifying the current situation:
“Recently, there have been a few media reports that bitcoin has been declared illegal by the Indian government,” began the post. “No, that is not true. Nothing has changed regarding bitcoin’s legal status in India this week. In our opinion, bitcoin is not illegal. Bitcoin is legal under all existing laws. It’s business as usual at all Indian bitcoin exchanges, including Zebpay.”
Last week’s creation of the virtual currency committee to assess use cases, prevent fraud, and assist with establishing regulation for cryptocurrencies could be the potential first step in a harmonious relationship with the technology. However, the Ministry of Finance was paramount in the creation of the new committee and, like the majority of its other members, remains skeptical of the technology.
ETHNews reached out to Securecoin, Unocoin, and Zebpay for further comment, but have yet to receive responses at the time of this publication. Nevertheless, the DBAFI remains a key proponent of cryptocurrency awareness and innovation within India and could potentially determine the fate of the nation’s cryptocurrency use. The foundation has declared:
“We have seen that in countries where governments have come out with a self-regulation policy, created an environment for the bitcoin/ blockchain technology to grow, those countries have become the epicentre for innovation. Investments have started pouring in and next generation, new edge technology developments, user-friendly products and a new breed of entrepreneurs have developed.”