![India's SEBI to ask IPO promoters to sell off cryptos](http://bitcoinworld.co.in/wp-content/uploads/2021/02/Indias-SEBI-to-ask-IPO-promoters-to-sell-off-cryptos.jpg)
India’s SEBI recently communicated with the lawyers and bankers affiliated with the IPO process. SEBI announced that the company’s promoters have to trade their crypto assets before making a debut in the market. SEBI interacted with the merchant bankers and lawyers lately and demanded the promoters to sell off their crypto holdings before petitioning for an IPO.
Moreover, cryptocurrencies have been a grey area in India. There has been a lack of clarity over the suggested ban on cryptocurrency for years. Additionally, communication regarding the assets has been informal. Nevertheless, this step of restraining the crypto assets holders from filing for an IPO to raise money comes into effect as SEBI doesn’t want the money raised to trade illegal assets.
Experts share their opinion on SEBI’s decision
Notwithstanding the concern regarding the funds produced via an IPO, several concluded that securing crypto should not be a red flag. As per Vatsal Gaur, partner, Pier Counsel, possessing crypto does not significantly present the company to any risk. It is comparable to handling any other financial assets free of risk to the registered company’s operations. Earlier in February, reports also appeared that India’s parliament was planning to fast-track the cryptocurrency bill.
Furthermore, if the ban does not come into effect, some investment bankers advocate SEBI may still ban promoters from holding crypto. Conversing with Economic Times, Mahesh Singhi of investment banking firm Singhi Advisors elucidated that SEBI is terrified of a circumstance where IPO promoters redirect funds raised from public sales to risky investments. To now, some IPO promoters have already thought of a temporary solution in the form of an affidavit saying that they will convert all cryptocurrency holdings in 24 hours if the rumored ban comes into effect.
About the current crypto ban, Balaji Srinivasan, former Coinbase chief technology officer, stated that such a move would be similar to banning the internet. India may follow the footsteps of Nigeria if the government announces a total ban. With a heightened awareness and interest India will face more difficulty banning cryptocurrencies.
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