Giottus, a home-grown crypto exchange based in Chennai, has decided to keep a ‘zero-risk approach' in India, where crypto companies find themselves in trouble with the law time and again. WazirX, for instance, was recently served a show cause notice to justify crypto transactions worth Rs. 289.28 crores carried via its accounts. The government of India has been taking interest in tightening its oversight over the crypto sector while detailed rules to govern the crypto market are still under formation.
Two IIM-Calcutta graduates — Vikram Subburaj and Arjun Vijay — launched the operations of Giottus in 2018. In the last five years, the exchange has managed to keep its business away from legal troubles unlike its competitors like WazirX, and CoinSwitch Kuber.
In conversation with Gadgets 360, Subburaj admitted that he has surpassed taking many decisions to avoid locking horns with the government. This no-risk approach has some impact on the growth of the company.
“In India, the regulatory intervention into the business practices of crypto players has risen in recent years. Under the circumstances, we decided we wanted to enter the crypto space with nothing that could get us into legal troubles. We are completely bootstrapped, with no foreign parent or even investor at this point,” said Subburaj in conversation with Gadgets 360.
This year, Giottus is expecting to raise some capital wherein the two co-founders will hold maximum shares with themselves as well as the authority to decide the business practices of the platform without any pressure.
In a subtle but notable nudge, Subburaj's statement reminds of the WazirX-Binance debacle that transpired very publicly on Twitter last year.
At the time, Binance CEO Changpeng Zhao denied association with WazirX, three years after Binance had claimed the acquisition of the latter. The incident had caught the attention of India's financial watchdog, the Enforcement Directorate (ED).
Indian authorities have confiscated funds worth Rs. 953.70 crores from busting crypto-related crimes in recent years, finance minister Nirmala Sitharaman told the Lower House earlier this week.
As per the Giottus CEO, maintaining a clean business practice is all about being precisely compliant with the laws of the land.
Eventually, Subburaj believes, the issues linked crypto adoption will be tackled by adequate laws and its use cases will take the centre stage in its adoption drive.
“It is a time-consuming process, for the government to understand and analyse the investing patterns of their nationals before they can bring up laws around crypto. Instead of creating a new rule book to cover crypto, the authorities can perhaps include crypto activities under existing laws. For example, the current consumer protection laws can be altered to ensure financial safety of the investors, while mandating the companies to report suspicious activities,” he noted.
The Giottus CEO believes that the officials from the Indian government are keeping regular contact to keep discussions around ways to keep the crypto space safe from criminal exploitation open.
To control crypto crime on an international level, India imposed its anti-money laundering laws on the crypto trade activities on March 8, 2023.
Subburaj lauded the decision and said, “Exchanges will have to do KYC and EDD like banks and other financial institutions. Until now, it was only a best practice that exchanges were doing. Now, it will be mandatory.”
India's crypto advisory group, Bharat Web3 Association (BWA) is also communicating with the government and participating in drafting the laws to monitor this nascent digital asset industry.
Giottus will be joining the BWA alongside CoinSwitch, WazirX and other crypto players later this year, its CEO noted.
In order for its users to not face any financial losses, Giottus is not looking at launching any native coin for its exchange amid legal challenges.
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