SEBI made the proposal in response to a call for comments on the recently unveiled guidelines for digital currency advertising released by the ASCI, according to local reports.
The government’s decision would mean that while digital currency would be accepted as virtual currency, buying and selling would be regulated and monitored using the goods and services tax (GST).
The securities regulator reiterated its stance that investment advisors must not engage in buying and selling of unregulated assets such as digital gold.
The new system will use a distributed ledger technology to take advantage of more resilient solutions than the traditional centralized databases, according to the regulator.
India’s securities regulator has said firms will be expected to sell off any holdings in digital currency before going public with an IPO.