India’s Ministry of Information Technology has issued a directive that requires cryptocurrency exchanges, data centers and VPN providers to store user data for five years.
The directive, which will come into force on June 22, should help the country’s authorities to more effectively combat cybercrime. Cryptocurrency exchanges in India will store customer names, ownership, contact information and other user data. In addition, exchanges and VPN providers will be required to report any out-of-band incident to the country’s authorities within six hours of its occurrence.
However, the amount of data requested has led some crypto exchange users to question the viability of the initiative. They suggested that the government simply wants to control the privacy of people, which is contrary to the country’s constitution. In addition, many privacy-focused platforms and providers may cease operations in the country.
According to the CEO of the Unocoin exchange, Sathvik Vishwanath (Sathvik Vishwanath), this move will allow companies to understand what specific information they need to store. In addition, the new law will greatly simplify the fight against tax evasion and other crimes committed using digital currencies. The directive does not specify whether the law will only apply to Indian crypto exchanges or will also affect foreign companies operating in the country.
Earlier it became known that Indian cryptocurrency companies began testing P2P transactions that bypass exchange accounts in order to overcome the bans imposed by payment operators at the request of the Reserve Bank of India (RBI).
