Within days of the Reserve Bank of India’s February 1, 2017 warning about virtual currencies, four prominent bitcoin startups took matters into their own hands. Zebpay, Unocoin, Coinsecure, and Searchtrade announced the formation of the Blockchain and Virtual Currency Association of India, a self-regulatory body designed to engage with regulators and promote responsible cryptocurrency adoption across the country.
TL;DR
- Zebpay, Unocoin, Coinsecure, and Searchtrade formed the Blockchain and Virtual Currency Association of India (BVAI)
- The association was created in direct response to the RBI’s February 1, 2017 cryptocurrency warning
- BVAI aims to establish uniform self-regulation, including KYC standards for member companies
- India’s bitcoin ecosystem was growing rapidly, with BTC trading at roughly Rs 70,000 locally
- The move came as IDRBT, an RBI arm, published a blockchain technology whitepaper for banking
A United Front Emerges
The four founding companies met in Mumbai shortly after the RBI’s press release, which had reiterated that no entity had been authorized to deal with bitcoin or any virtual currency. The timing was deliberate. Saurabh Agarwal, co-founder of Zebpay, acknowledged that while discussions about forming an association had been ongoing, the RBI circular provided the final push to formalize the effort.
The new association replaced an earlier, defunct organization known as the Bitcoin Alliance of India, which had failed to gain traction when cryptocurrency companies were still in their infancy. This time, the founders made a strategic decision to broaden the scope beyond bitcoin alone, incorporating blockchain technology companies to create a larger, more influential coalition. The name itself, Blockchain and Virtual Currency Association of India, reflected this inclusive approach.
Self-Regulation as a Strategy
Central to BVAI’s mission was the establishment of uniform self-regulation standards across member companies. Sathvik Vishwanath, Unocoin’s co-founder and CEO, outlined the association’s objectives as achieving consistency in self-regulation and building a constructive dialogue with regulators about both bitcoin and blockchain technology.
A key focus was implementing robust Know Your Customer verification processes across all member exchanges. The association also committed to educating customers about the risks of Ponzi schemes and other fraudulent activities associated with digital currencies, directly addressing the consumer protection concerns the RBI had raised in its warning.
Legal advisor Nishith Desai revealed that the group was also advocating for inclusion in a new regulatory board the Indian government was creating for digital payments, arguing that virtual currency regulation should fall under the same framework.
India’s Growing Crypto Ecosystem
The formation of BVAI reflected the remarkable growth of India’s cryptocurrency market. Bitcoin was trading at approximately $989 globally and Rs 70,000 in India, having surged from Rs 40,000 just five months earlier in September 2016. The global cryptocurrency market capitalization stood at roughly $15.96 billion for bitcoin alone, with Ethereum trading at around $10.73 as the second-largest digital asset.
Indian consumers could purchase bitcoin through several platforms including Coinsecure, Unocoin, BTCXIndia, and Zebpay, using standard banking channels. Some exchanges had expanded beyond simple trading to offer e-commerce vouchers, movie tickets, and bill payment services, demonstrating the growing practical utility of bitcoin in everyday Indian commerce.
Blockchain Gets a Nod Even as Bitcoin Faces Scrutiny
Perhaps the most telling aspect of the regulatory landscape was the parallel track being pursued by India’s banking establishment. In January 2017, the Institute for Development and Research in Banking Technology, which operates under the RBI, had published a comprehensive white paper proposing a roadmap for blockchain technology adoption within Indian banking institutions.
This created a fascinating dynamic: while the RBI was cautioning against the use of bitcoin and virtual currencies, an arm of the same institution was actively exploring the underlying blockchain technology for potential integration into the traditional banking system. The contradiction highlighted a global pattern where institutions recognized the transformative potential of distributed ledger technology while remaining skeptical of decentralized cryptocurrencies.
Looking Ahead
The BVAI’s formation represented a maturation of India’s cryptocurrency industry. By organizing collectively and committing to self-regulation, these companies hoped to demonstrate legitimacy and build trust with both consumers and regulators. The association initially restricted membership to businesses, with plans to potentially open to individual members in the future.
As the global cryptocurrency market continued its upward trajectory in early 2017, with Litecoin at $4.08, Monero at $13.27, and Ripple at $0.0065, the Indian crypto community found itself at a crossroads between rapid innovation and regulatory uncertainty. The BVAI’s success in bridging that gap would have significant implications for the future of cryptocurrency adoption in the world’s second-most populous nation.
Why This Matters
The formation of BVAI marked a critical moment in India’s cryptocurrency journey, demonstrating that the industry was mature enough to self-organize and engage constructively with regulators. The tension between the RBI’s cautious stance on virtual currencies and its own exploration of blockchain technology mirrored debates happening worldwide. This episode foreshadowed years of regulatory evolution in India, from restriction to eventual recognition, and highlighted how industry self-regulation can serve as a bridge between innovation and institutional acceptance.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always conduct your own research before making investment decisions.
Zebpay was the biggest exchange in india at the time and still got shut down by RBI in 2018. forming BVAI changed nothing for them
arjun_t they had no legal leverage. RBI didnt care about a self regulatory body with four members. supreme court did all the work in 2020
Rs 70,000 per btc and RBI killed it for three years. india could have been a top 5 crypto market by now without that ban
BVAI trying to set KYC standards in 2017 while RBI was literally telling banks to stop dealing with crypto exchanges. bold move honestly
Anika R. RBI published a blockchain whitepaper for banks in 2017 while warning the public about crypto. same institution two opposite opinions. classic
funny how india went from ‘bitcoin is banned’ vibes to having one of the biggest crypto populations. zebpay was everywhere back then
Rs 70,000 BTC was roughly $1050. those four companies basically created the foundation for Indian crypto adoption before the government even understood what was happening
zebpay processed like 80% of indian volume at peak. when they shut down after RBI ban it killed the entire market for a year
desi_hodler_ Rs 70,000 was roughly $1050. btc is what, 60x from there now. imagine the opportunity cost of RBI killing Indian crypto exchanges for 2 years
Rs 70,000 for a bitcoin… if only we had held. The BVAI was ahead of its time trying to self-regulate before the government cracked down.
my cousin bought at that price and sold at 2 lakh. thought he was a genius. hes still crying about it lol
KYC push was the main response back in 2017.
IDRBT publishing a blockchain whitepaper while RBI warned against crypto. classic government split personality on new tech
Neha G. IDRBT publishing a blockchain whitepaper for banks while RBI called crypto dangerous is peak government cognitive dissonance. same building two opposite opinions
IDRBT literally published a guide for banks to use blockchain while RBI said crypto was dangerous. same institution, two completely opposite signals
Anika R. the irony is RBI banned crypto dealings in 2018 anyway. BVAI KYC standards meant nothing when the banks just cut off the exchanges entirely
rbi_watcher_ and then the Supreme Court overturned the RBI ban in 2020 anyway. all that KYC infrastructure BVAI built just got regulated out of existence for 2 years
rbi_watcher_ the Supreme Court overturning the RBI ban in 2020 proved BVAI was right all along. two years of lost adoption because the regulator panicked
rupee_maxi_ the Supreme Court overturning the ban proved the whole thing was political theater. meanwhile the people who bought at Rs 70,000 are up 600x
rbi_watcher_ RBI banned crypto in 2018, Supreme Court killed the ban in 2020, and now India has 100M+ crypto holders. BVAI was right and RBI wasted 3 years fighting the inevitable
Kiran M. IDRBT literally built a blockchain guide for banks while RBI called crypto dangerous. then they used that same research to build the digital rupee CBDC. monopoly not safety
Rs 70,000 BTC in early 2017. zebpay unocoin and the others tried to self regulate with KYC and RBI still killed their banking access in 2018. brutal
Four companies forming their own association in response to RBI warning. shows how fast crypto self-regulates
Zebpay Unocoin and the others starting BVAI after the RBI note makes sense.
IDRBT publishing a blockchain whitepaper for banks while RBI warned against crypto. classic left hand doesnt know what right hand is doing
Deepak V. and the kicker is RBI used that blockchain whitepaper to research CBDCs. they didnt ban the tech they just wanted to monopolize it