The Securities and Exchange Board of India (SEBI) said that investment advisors should not provide services for unregulated assets. This includes “digital gold.”

In its statement, India’s financial regulator acknowledged that some registered investment advisers had been engaging in unregulated activity by providing a platform for exchanging “unregulated products including digital gold.” 

SEBI emphasized that offering advisory, distribution, execution, or implementation services for such unregulated instruments went against Section 12(1) of the SEBI Act, 1992. It further warned that investment advisers’ dealing in unregulated activities could entail action under the SEBI Act.

The notice effectively prevents professional investment advisors from providing consultation to investors of digital assets. Ostensibly, this also includes cryptocurrencies, a market that is rapidly growing in the South Asian country. 

According to industry sources, there are 15 million crypto investors in India. In addition, they are holding an amount worth over 100 billion rupees ($1.37 billion). Over 12 months, India’s market grew 641%, according to data analytics firm Kantar.

Its recent survey revealed that most Indians who own cryptocurrency are between the ages of 21 and 35. They also live in metro cities. 

Many sources corroborate that this growth can largely be attributed to youth across the country. For example, CoinSwitch Kuber acquired 11 million crypto exchange users 18 months since its inception. The average age of this base is 25.

Contrary to the Kantar survey, registration data from crypto exchange and service providers suggests the spread of cryptocurrencies in India is being driven by adoption from young investors from non-metro cities.

One prominent example of the youthful force behind the country’s enthusiastic adoption of cryptocurrencies is Indian teenager Gajesh Naik, aged 13.

In April this year, Naik launched decentralized finance (DeFi) yield aggregator Gaj Finance. The platform also serves as a marketplace for non-fungible tokens (NFTs) and runs on the Polygon blockchain. To date, Gaj Finance has around $1.2 million in total value locked (TVL). 

Recently, Naik raised $300,000 in pre-seed funding for his latest DeFi project called Taksh. Built on Avalanche, the protocol aims to maximize yields by “compounding rewards and farming.”

The post India’s Financial Regulator Bars Advising on Digital Assets appeared first on BeInCrypto.

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