SEBI bars registered investment advisors from advising on crypto
The Securities and Exchange Board of India (SEBI) recently prohibited registered investment advisors from providing crypto-related services to their clients, considering that crypto falls under the category of ‘unregulated activities’ in India.
A notification dated 21 October 2021 stated, “Investment Advisers are, hereby, advised to refrain from undertaking such unregulated activities. Any dealing in unregulated activities by investment advisers may entail action as deemed appropriate under the SEBI Act, 1992 and regulations framed thereunder.”
This announcement is likely due to the fact that registered investment advisors have been, reportedly, receiving daily crypto-related queries..Some advisors have allegedly started advising on crypto investments.
“It has come to the notice of SEBI that some registered Investment Advisers are engaged in unregulated activity by providing platform for buying/ selling/ dealing in unregulated products including digital gold. Undertaking such unregulated activity including dealing (i.e., advisory, distribution and execution/ implementation services) in digital gold by Investment Advisers is not in accordance with the provisions of Section 12(1) of the SEBI Act, 1992 read with the SEBI (Investment Advisers) Regulations, 2013,” said the regulatory body.
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