Reports earlier this week said that Indian Cryptocurrency Exchanges are working together to create a central repository of transactions by traders in a bid to self regulate. Seven cryptocurrency exchanges have come together to form the Blockchain and Cryptocurrency Committee (BACC) of the Internet and Mobile Association of India and more are expected to join.
The Proposal to Self-Regulate
Simply put. The exchanges will pool trading data of users based on PAN and create a central repository for the government. Currently, transactions are recorded by each exchange but not shared with any other exchange, they are mutually exclusive.
Under the BACC’s proposal, all exchanges will mutually share the records of trades to create a common database. This database can then be used to extract all the trades done by any trader based on their PAN details.
This could be one of many proposals that the BACC will submit to the Government.
“We will be shortly making comprehensive recommendations for regulations.”
said Ajeet Khurana who heads the BACC on a LinkedIn private chat with Coin Crunch India.
Who has come together for BACC?
Khurana says “All Exchanges are welcome to join (the committee)”.
The current list of BACC members include:
- Pocket Bits
It won’t be surprising to see more names joining this list in the future, given that exchanges would want to avoid harsh regulations. If by handing over the trade data, the government can let them operate, so be it.
Coin Crunch Opinion:
We welcome all the measures taken by exchanges to continue a smooth running of cryptocurrency trades in India. A central repository of transactions will definitely make the job of the Income Tax department easier in tracing the transactions, but can that really help?
This will just increase troubles for the honest traders who trade on international exchanges because the extra BTC/ETH earned from that trade will be unaccounted for on Indian exchanges. Government will set out on the goose chase after such traders who will be able to provide the proofs of earnings, eventually wasting the government’s time and money.
Central or not, Government can and will have access to trading database when they want, we saw that happen in the earlier Survey conducted by Income Tax department on the exchanges. The evaders are the ones who don’t trade on KYC compliant exchanges. I feel it is better if the BACC can focus on bringing them under the radar.
Disclaimer: This is an opinion piece and anything said is the personal opinion of the author and not of Coin Crunch India in general.