- Ripple continues to strive for crypto-friendly regulation in India, as Navin Gupta revealed.
- The company is working with regulators and banks in India to promote innovation with cryptocurrencies.
Ripple’s Managing Director for South Asia and the MENA region, Navin Gupta, gave an interview to news portal Techcircle and spoke about Ripple’s growth in India and the most important issue in 2021. The San Francisco based company has been trying to expand in India since 2018 and has entered into a number of partnerships for this purpose. These include partnerships with Kotak Mahindra Bank, Federal Bank and IndusInd Bank, the report clarifies.
The country is one of the most attractive for Ripple in Asia in terms of sending and receiving remittances. With a banking system that charges its users up to 7% of the total transaction value to be processed days later, Ripple’s solutions can be of immense benefit to people inside and outside the country, Gupta said:
In 2019 alone, India received $79 billion in remittances, which is higher than China. Almost 35 million Indians are living abroad and regularly sending money. These transactions are of lower ticket sizes like $500 to $1000.
Ripple demands clear rules
The Securities and Exchange Commission’s lawsuit against Ripple and some of its executives is one of the defining issues in the crypto market. And even though the situation in India is somewhat different, the fate of Ripple and the XRP token there also depends on the verdict of a court.
Although Ripple is not involved in any litigation in India, it is in constant talks with regulators and lawmakers. Ripple has been trying to promote a legal framework and measures that will benefit the country and its citizens, Gupta said:
Regulators need to make up their minds. We have been in continuous discussions with them. First they need to decide which body will lead the cryptocurrency policy, will it be RBI or Sebi. Once the lead regulator is decided, there can be public and industry consultation.
Effective regulation must first make a distinction between the different types of digital assets that consumers will have access to. This is one of the central issues in the SEC’s lawsuit against Ripple and is an issue that the company has been asking for clarification on for years. The Ripple manager stated:
Also, clarification on the taxonomy of crypto, digital assets and blockchain is needed. Some countries like Malaysia terms digital assets as commodities, if India follows a similar method then it will fall under Sebi. If it is a payment instrument or currency, it falls under RBI.
Despite Ripple’s efforts, there are strong rumors that India may reinstate a ban on crypto trading in favor of a national CBDC. However, Gupta warned against the dangers of stopping innovation in this area:
Banning a technology or taking a point of view against the technology is not the correct way. Take a view on use cases. For banks and domestic needs we don’t need digital assets or cryptocurrencies but for cross border, absolutely, because it lowers the import and export costs. It is not all or nothing, you can use the technology in usecases where it is needed.
In that regard, the Ripple executive listed the benefits of integration between cryptocurrencies and the legacy financial system. Gupta ruled out that cryptocurrencies will replace fiat currency; on the contrary, these assets would operate complementarity. Otherwise, Gupta was bullish on the emergence of crypto services from giants such as PayPal, and concluded:
Cryptocurrencies will not replace real currency, they will only complement it. What we can see is that digital assets can drastically improve cross-border payments, where there is currently a lot of friction. Companies like Paypal allowing the use of cryptocurrencies for payments is great news.