March 27, 2024
Policy & Regulation

India to Boost Stock Market Competitiveness Amid Crypto Rise

India is preparing to revamp its stock market operations by introducing a speedier trade settlement method, to increase competitiveness in the face of the growing appeal of cryptocurrency exchanges. On March 11, Madhabi Puri Buch, Chair of the Securities and Exchange Board of India (SEBI), announced plans to adopt a T+0 trade settlement cycle by March 28, with same-day settlement available as an optional service to traders.

Transitioning to Competitive Edge

The move marks a departure from the existing T+1 settlement cycle, where trades are settled a day after execution. Buch emphasized the necessity of transitioning to T+0 to align with investor expectations of instantaneous settlements, crucial for the stock market to contend with the crypto sector’s allure.

According to SEBI, adopting T+0 will provide investors with immediate receipt of funds and securities, eliminating settlement risks and granting enhanced control over their assets.

Crypto Exchange Crackdown Amidst Adoption of Blockchain Technology

In a related development, India has sent notifications of noncompliance to prominent cryptocurrency exchanges such as Binance, Kraken, and Bitfinex for illegal operations within the nation. The exchanges were given a 12-day deadline to comply with Indian Know Your Customer and Anti-Money Laundering legislation, demonstrating the government’s tough position on cryptocurrency transactions.

Despite regulatory skepticism towards cryptocurrencies, India is actively embracing blockchain technology across various sectors. Recent revelations indicate the hosting of over eight million government-issued documents on five different blockchain platforms. The country primarily leverages Hyperledger Fabric, Hyperledger Sawtooth, and Ethereum for blockchain initiatives, encompassing products like certificate chain, document chain, drug logistics chain, judiciary chain, and property chain.

India’s proactive approach to blockchain adoption, combined with the implementation of a speedier trade settlement mechanism, demonstrates its commitment to modernizing financial infrastructure while navigating the changing world of digital assets.

Image by starline on Freepik

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