By Aditya Kalra

DAVOS (Switzerland) – India should establish rules for cryptocurrency to eliminate regulatory uncertainty and protect investors, CoinSwitch CEO Ashish Singal stated on Sunday.

The Indian central bank supported a ban of cryptocurrencies due to risks to financial stability. However, the move by the federal government to tax their income has been seen by the sector as an acceptance from New Delhi.

Singhal, a former engineer at Amazon (NASDAQ) who helped to found CoinSwitch told Reuters during the World Economic Forum in Davos.

CoinSwitch is valued at $1.9billion and boasts more than 18m users. Andreessen Horowitz Ventures and Tiger Global are backing the company, which is based in Bengaluru’s major tech center.

He added, “Regulations can bring peace… greater certainty.”

This year, Davos is hosting a lot of cryptocurrency and blockchain companies. It coincides with an era when crypto prices are falling around the globe.

India’s central bank raised “serious concern” about private cryptocurrency, but in December, Prime Minister Narendra Modi said that such technologies must be used to strengthen democracy and not subvert it.

India has a lot of difficulties for exchanges to collaborate with banks and allow funds transfer. CoinSwitch disassociated rupee deposits from a network supported by the State in April. Investors were alarmed.

‘CLARITY’

Singhal indicated that although some steps have been taken to reduce advertising and taxation, more needs to be done. Singhal also said that India must create a new set of laws.

These regulations should contain norms to verify identity and transfer crypto assets. India must also establish a system for tracking transactions and reporting them to any authorities, should they be required.

CoinSwitch has estimated that India’s cryptocurrency market is worth up to $20 million. It also estimates India’s total crypto holdings at $6 billion.

There has been a lot of regulatory uncertainty. Coinbase, America’s largest cryptocurrency exchange, opened in India in April. But, within days, it had halted the use of its state-backed interbank transfer service.

Brian Armstrong, Coinbase’s CEO, said that in May the change was due to “informalpressure” from India’s central bank.

Singhal revealed that CoinSwitch had also stopped so-called UPI transfer to make it easier for banking partners. He said CoinSwitch was in negotiations with regulators for a restart of the transfer service.

We are demanding regulations. He said that the correct regulation would bring clarity.