NSE Bans Digital Gold Selling: The National Stock Exchange (NSE) has directed its members, including stockbrokers, to stop selling digital gold on its platform from September 10. The NSE has given this direction after market regulator Securities and Exchange Board of India (SEBI) raised concerns. SEBI had said that some members are providing a platform to their customers to buy and sell digital gold, which is against the rules.
SEBI, in a letter issued on August 3, told NSE that such activities are against the Securities Contracts (Regulation) Rules (SCRR), 1957. Members should refrain from doing any such activity. SCRR rules prohibit indulging in any such activity. Such activities are also prohibited for any NSE employee.
Instructions to comply with regulatory requirements
Following concerns raised by SEBI, NSE has directed its members not to indulge in such activities and to comply with regulatory requirements at all times. In a circular issued on August 10, NSE said, “Members presently involved in these activities shall, within one month from the date of this circular, cease all activities in this regard.” Necessary information regarding the discontinuation of these activities should be given to the concerned customers.
TradeSmart Chairman Vijay Singhania said that Digital Gold Units are not issued by any regulated entity. There is no way to check whether there is gold in physical form as per Digital Gold Certificate. Digital gold does not come under the definition of securities as per the Securities Contracts (Regulation) Act 1956.