Securities and Exchange Board of India (SEBI) Chairman Ajay Tyagi urged mutual funds to avoid investing in cryptocurrency-related assets as the government considers new cryptocurrency rules. Speaking at a press conference on Tuesday, Tyagi advised that companies refrain from investing in crypto-asset-linked funds until there is clarity on the regulatory and regulatory framework.
โThose who have invested in mutual funds, - in companies related to crypto assets or foreign firms through funds of funds (FOF) - my opinion is that until we are clear about their (crypto) policy, companies should not do such investments โ, said the president of SEBI.
While the regulatory environment for cryptocurrencies in India is currently murky, the country has already witnessed an exponential rise in popularity. It's also unclear whether crypto investments come with tax obligations in the country.
Tyagi's remarks come after the recent event involving an asset management company (AMC), Invesco Mutual Fund. Despite Sebi's approval, delayed its blockchain fund last month due to legislative uncertainty.
Recently, there has been talk of cryptocurrency being discussed in Parliament during the winter session. The talks gained further momentum following the meeting of a permanent parliamentary committee on finance with cryptocurrency stakeholders to identify potential opportunities and challenges that may arise when it comes to financing and investing cryptocurrencies.
Related: Institutional managers hold a record $ 72.3 billion in crypto - CoinShares
The Indian government had formally planned to present the Official Cryptocurrency and Digital Currency Regulation Bill, 2021, for debate in parliament during its current winter session. The bill, however, does not appear among the bills that India's lower house will consider at the end of the winter session.
Meanwhile, Indian Prime Minister Modi has been increasingly vocal regarding cryptocurrencies in 2021. During the recent Sydney Dialogue, Modi urged democratic nations to collaborate to make the most of cryptocurrencies and blockchain technology. He also warned against malicious use.
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