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Despite the threat of a crypto ban, crypto companies thrive, with new goods and services being created and international exchanges opening up shop.

Despite legal uncertainties and calls from some for an outright ban on virtual currencies, the launch of what is billed as India’s first cryptocurrency index is among a rush of new startups in a field that shows no signs of slowing down.

Since 2019, when a law attempting to ban the usage of digital assets first surfaced, the Indian government has been delaying action on crypto legislation. Since then, the crypto business has been plagued by rumors of a ban, but not enough to halt its expansion.

The number of crypto investors in India has doubled in the last two years, from 7 million in 2020 to 15 million in 2021. But it isn’t just investors who are affected. Even crypto businesses in India appear unconcerned about regulatory uncertainty as exchanges list more and more coins and crypto enterprises introduce new products.

While retail investors are still sensitive to ban rumors, as evidenced by the panic sell-off that occurred when a crypto bill was placed on the parliamentary agenda for the winter session, crypto firms are certain that there will be no ban.

As mentioned in the legislative agenda last year, the purpose of India’s crypto bill was to prohibit all private cryptocurrencies with some exceptions and establish a framework for a central bank digital currency (CBDC). The concept of private cryptocurrency is unknown, as are the exemptions. As a result, any knowledge about the government’s stance on cryptocurrencies is hypothetical.

The only signs regarding the government’s imminent decision come from Finance Minister Nirmala Sitharaman, who has repeatedly told the public that the government will not ban cryptocurrency. As a result, crypto exchanges and businesses appear to be free of the threat of a ban.

Last year, two foreign exchanges, CrossTower in the United States and Coinstore in Singapore, opened offices in the world’s second most populated country. CrossTower CEO and co-founder Kapil Rathi told Forkast in an earlier interview that he was “100% convinced” that cryptocurrency would not be prohibited in India.

CryptoWire, a firm founded in December, issued India’s first crypto index earlier this month. The IC15 index measures the performance of the top 15 most liquid cryptocurrencies in terms of market capitalization worldwide, excluding stablecoins.

India INX, the international arm of the BSE (previously Bombay Stock Exchange), and Torus Kling Block Chain IFSC sought regulatory approval for a Bitcoin and Ethereum futures exchange-traded fund within a few weeks (ETF). An ETF is an investment that tracks an index, sector, commodity, or other asset and can be traded like any other crypto asset or stock on a stock exchange.

Similar ETFs, such as ProShares, debuted in the United States last year and failed miserably. However, this hasn’t stopped Indian companies from developing ETFs to broaden Indians’ access to the crypto market.

Rastogi went on to say that the industry is not unaffected by regulatory uncertainty but rather has become accustomed to it. Given the current opportunity, the risk of negative regulatory changes appears to be manageable for firms, according to Rastogi. To put it another way, the benefits outweigh the risks of regulatory action against the crypto market.

On the other hand, companies have not abandoned caution behind the scenes. Because of the looming ambiguity, several products are restructured before launch or never see the light of day, according to Rastogi, who also advises crypto firms.

Even former finance secretary Subhash Garg, who prepared the 2019 crypto bill, has changed his mind and now supports regulation over a ban, calling fears of a crypto ban in India an overreaction; the future of the Indian crypto business remains uncertain until the revised bill is made public.

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