MUMBAI: Online stock broker Zerodha’s co-founder Nithin Kamath has called for the government to bring in checks and balances for advertisements by cryptocurrency and forex trading platforms.
“The govt should put in checks not just for crypto ads, but also unregulated CFD/Forex platforms,” Kamath said in a tweet earlier today.
Kamath’s comments come in the backdrop of concerns raised in some pockets of the investment community in India about full page print and online advertisements by cryptocurrency trading platforms in the past few months.
If financial services businesses are allowed to mis-sell greed & easy + guaranteed returns from risky financial pro… https://t.co/PefREVz5DM
— Nithin Kamath (@Nithin0dha) 1637216587000
India currently has over 1.5 crore cryptocurrency users with total assets worth over $6 billion.
Alongwith cryptocurrency platforms, several forex and stock trading platforms have flooded popular social media platforms and television networks with advertisements to attract users at a time when India is seeing a record influx of first-time retail investors in its stock market.
Stock trading platforms like Zerodha, Upstox and Grow among others have added 1 million new dematerialised accounts on monthly basis over the past year as work from home and lack of spending avenues during lockdown pushed individuals towards investing in various financial products like stocks, crypto and commodities.
“If financial services businesses are allowed to mis-sell greed & easy + guaranteed returns from risky financial products, it not only harms consumers but it creates a systemic risk,” Kamath said.
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