As the Indian government is working on the regulatory framework for cryptocurrencies, startups in the country are finding a way to accept bitcoin and other cryptocurrencies without breaking the law.
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The country’s finance minister Arun Jaitley announced during his Budget speech last month that “the Indian government considers cryptocurrencies illegal and vowed to stamp out their use,” Tech Circle wrote and elaborated:
However, Jaitley did not specifically state that trading in cryptocurrencies was illegal, which is why it continues to be business as usual for Indian cryptocurrency exchanges such as Zebpay and Unocoin.
Partnership with Unocoin
Regulatory Loophole Helps Startups in India Accept Bitcoin Without Breaking the Law“Truebil will be accepting bitcoin payments at its brick-and-mortar stores using Unocoin’s POS application,” the publication clarified. The company itself does not display any prices in bitcoin and does not accept payment in the digital currency online. Its co-founder and marketing head Shubh Bansal told the publication that “this move is perfectly legal,” emphasizing:
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We are not accepting the [crypto] payments directly…Unocoin as our partner will receive the ‘crypto-assets’ from the consumer and then change it into a fiat currency before depositing it in our bank account. This brings it under the legal purview of existing laws.
Is This Arrangement Really Legal?
The news outlet asserted that legal experts have doubts about this arrangement. Prashant Phillips, a partner at law firm Lakshmikumaran & Sridharan told the publication that “Such transactions would most certainly be on the government’s radar.”
While acknowledging that there is no specific provision to penalize crypto transactions, “the government has clearly indicated that it considers the validity of such dealings to be on par with ponzi schemes,” he explained, adding:
If a formal notice is passed declaring such transactions as ponzi schemes, then such transactions may be punishable in terms of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.
Source (https://news.bitcoin.com/regulatory-loophole-startups-india-accept-bitcoin-without-breaking-law/)