The Computer Emergency Response Team (CERT) in India has been selected to act as the national agency for cyber security. Included in the CERT’s portfolio is the crypto industry, which means that the move now shows the agency recommended for dealing with activities in the sector.
This move requires all crypto businesses, including virtual asset providers, to gather and store know-your-customer (KYC) details and records of financial transactions for five years. This move is aimed at helping to address cyber security in payments and financial markets while securing clients’ data and promoting fundamental rights in the fast unfolding digital assets industry.
A Soft-Approach to Crypto Regulation
The crypto industry sees the announcement as a softened approach toward regulations before more specific laws are installed. India is yet to give its stand towards crypto regulation. In February, a stronger rule to tax crypto businesses before the installation of crypto legislation was issued.
The crypto legislation in India is still in the cold store as the government looks for global consensus. The finance minister, Nirmala Sitharaman, has indicated that cryptos come with huge benefits, but they are also concerned about the risks.
Sitharaman said that blockchain is full of potential not only in the area of payment but in so many other ways. “Our intention is not to hurt this … however, it can also be manipulated for not-so-desirable ends …” she added.
This is the first instance when the Indian administration has emphasized that the data on crypto transactions in the country has to be stored securely for five years. In addition, the KYC process and data procedures must be kept in line with the guidelines of three main entities:
- Department of Telecom (DoT)
- Securities and Exchange Board of India (SEBI)
- The Reserve Bank of India (RBI)
All crypto businesses in India will also be required to pick a CERT’s point of contact as a way of maintaining open communication about new crypto rules. Sitharaman, when speaking in a public forum on 29th April 2022, said she is seeking collective global action.
Sitharaman also called the outside world to be patient with the Indian response. It will take time for all to be sure they are taking the right action. “It cannot be rushed,” she added.