A Parliamentary Standing Committee has raised concerns over retail investor protection in India's cryptocurrency market, seeking detailed responses from leading crypto exchanges on safeguards, consumer awareness and regulatory accountability, sources told NDTV Profit.
Representatives from WazirX, ZebPay and Binance made presentations before the panel, outlining their operational frameworks, compliance standards and measures aimed at protecting retail investors, the persons said.
The committee members flagged concerns around investor safety, grievance redressal mechanisms and the lack of a clearly defined regulatory structure governing crypto platforms operating in India, according to the sources.
ALSO READ: India's Core Industries See 1.7% Growth In April After Iran War-Triggered Lows
The Bhartruhari Mahtab led committee also asked exchanges to provide details on investor education initiatives, risk disclosures and safeguards designed to protect retail participants in the highly volatile crypto market.
According to sources, authorities are examining ways to make crypto investing safer for retail investors while balancing innovation and market development.
The discussions also included concerns around certain firms operating from offshore jurisdictions to avoid regulatory scrutiny in India, sources said.
Industry participants, meanwhile, pushed for tax rationalisation, easier banking access and regulatory clarity. Several exchanges also argued in favour of establishing a dedicated regulator for the crypto sector, according to people aware of the matter.
ALSO READ: RBI's VRR Auction Sees Weak Demand For Fifth Straight Time Despite Tightening Liquidity
The government has reportedly sought detailed follow-up responses from industry stakeholders following the discussions.
Cryptocurrencies currently remain largely unregulated in India and are not recognised as legal tender. The government classifies them as Virtual Digital Assets (VDAs), with transactions subject to stringent taxation norms, including a 30% tax on gains and 1% tax deducted at source (TDS) on transactions.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
