Concerns so far expressed on social media by financial market participants about allegedly aggressive advertising practices for exchanging crypto currencies have now spilled over to the Delhi Supreme Court.
Earlier this month, two lawyers filed a public interest lawsuit against WazirX, Coinswitch Kuber, and CoinDCX, and the court stepped in to order India’s capital market regulator to issue guidelines and act against the crypto currencies requirements.
The Encryption Exchange, the Securities and Exchange Board of India (SEBI), and the Ministry of Information and Broadcasting were named as respondents in the case.
The court gave them time to respond by August 31, the date of the next trial.
“Without a standardized rate, the normal class of retail investors runs the risk of having their interests not protected by [Sebi],” the petition says.
While encryption is a riskier asset class than stocks or mutual funds, he said encryption exchanges don’t follow standard TV trading guidelines.
Coinswitch Kuber and CoinDCX said in a statement that they are placing a disclaimer on their ads.
WazirX was not immediately available for comment.
The three exchanges have a total of 15 million users, most of whom are young and new to cryptography.
In recent months, coding changes have doubled in terms of advertising on social media, streaming platforms, and TV.
Bursting with funds, they hired celebrities and influencers, which were trumpeted during the Indian Premier League and encouraged investors to buy small fractions of core Bitcoin for just Rs 100. In some cases, the petition claims that exchanges promise astronomical returns.