Sebi sends foreign officials to study cryptocurrencies, initial offer of coins

The market regulator Sebi has sent its officials to foreign countries to study the first offers of coins and cryptocurrencies, a move that will help in understanding systems and mechanisms.

Cryptocurrencies are digital units where cryptographic techniques are used for these "currencies" operate independently of a central bank, while initial coin offerings are equivalent to initial public offers in equity markets.

The regulator organized study visits to the Japan Financial Services Agency; the United Kingdom's Financial Conduct Authority and the Swiss Financial Market Supervisory Authority "to study the first offers of coins and cryptocurrencies," said Sebi in his annual report for 2017-18.

Study trips "help to involve international regulators a deeper understanding of systems and mechanisms".

In addition, Sebi has hosted a number of international organizations including regulatory bodies and corporate and ministerial delegations in the past.

"These meetings promote deeper levels of cooperation, facilitate a better understanding of the Indian securities market and facilitate further collaboration with visiting institutions," noted the Sej (Securities and Exchange Board of India).

The government has already set up an interdisciplinary committee chaired by Subhash Chandra Garg, secretary of the department of economic affairs, to examine the existing framework in relation to virtual currencies.

Other group members include the chairman of Sebi Ajay Tyagi and the deputy governor of the Reserve Bank of India B P Kanungo. The committee has yet to present its report.

At the beginning of July, the RBI had told the Supreme Court that allowing transactions in cryptocurrencies like Bitcoin would encourage illegal transactions and has already issued a circular prohibiting the use of these virtual currencies.

While crypto investors filed a complaint against the ban, the Supreme Court had refused to revoke the RBI ban to negotiate cryptocurrencies. The final hearing of the case is scheduled for September 11th.