India’s top securities regulator is reportedly asking supporters of companies seeking to go public to sell their cryptocurrency assets before they raise money.
Details of the subject
The Economic Times reported on Monday’s news, citing “a large number of people who have direct knowledge of the matter”. The Securities and Exchange Board of India (SEBI) reportedly notified bankers, securities lawyers and company executives involved in the public offering process of the restrictions.
The restrictions are reportedly due to the possibility of India banning cryptocurrencies. A securities lawyer currently working on some public offerings told ET, “An instruction may be taken from the government on this issue.” SEBI seems to think that “an entrepreneur’s possession of an illegal asset in the country could pose a risk to investors.”
According to Vatsal Gaur, partner of law firm Pier Counsel, SEBI “is being overly cautious here.”
“If a supporter owns any cryptocurrency, he may not expose the company to any risk, Gaur told ET. “Holding any other financial asset does not pose a risk to the operations of a listed asset,” he said.