Ajay Tyagi, the chairman of the Securities and Exchange Board of India (SEBI), said that investments in crypto products cannot be made by domestic mutual funds. He said that once there exists a law for crypto products in India, domestic mutual funds can make investments depending on the regulations framed by the Indian government. The SEBI chairman made these statements in a press conference that took place following a SEBI board meeting.
Recently, the launch of the domestic mutual fund Invesco Mutual Fund’s Blockchain fund was withdrawn. The fund’s aim was to make investments in companies that operate in the blockchain and crypto space. It would also allow Indian investors to invest in blockchain and crypto companies based in other countries. The withdrawal happened due to the current uncertainty surrounding cryptocurrencies in India.
The Indian Parliament’s winter session was all set to see the tabling of a cryptocurrency bill aimed at prohibiting private cryptocurrencies. However, the tabling was withdrawn towards the very end of the winter session, with government sources saying that wider consultations with experts are necessary.
The initial announcement from the Indian government was met with panic, as Indian crypto exchanges saw many popular crypto tokens’ values fall rapidly. However, since the bombshell announcement, the Indian Prime Minister has spoken at length about cryptocurrencies and the government’s stance towards them on multiple occasions.
Right now, it seems as though India will ultimately let cryptocurrencies and crypto companies operate in the country with regulations in place. However, the Reserve Bank of India (RBI), the country’s apex financial authority, has repeatedly stressed on the need to ban cryptocurrencies altogether.