HISTORY'S MESSAGE FOR VIRTUAL DIGITAL ASSET REGULATIONS

A SPOTLIGHT ON FINANCIAL ASSETS, SOCIETY & REGULATIONS

- Srinath Sridharan

IN A PREVIOUS OPINION piece, I had touched upon how Indian consumers are adopting purchases of Virtual Digital Assets (VDAs), despite high taxation. It would be relevant to learn how the history of financialisation of assets shaped up over the centuries, and how moral sanction and regulatory embrace happened, either as a counter view or at times, even convergence. Law and Morality are two different concepts that govern the way humans behave. Morals are principles or standards of behaviour that define human conduct within society, but don’t define any compulsion to follow them.

Law is a set of rules and regulations that all people are obligated to adhere to, if they want to live within the boundaries of a society. The relationship between law and morality has inter-dependencies between them, but are not the same. When we think of these newer emerging asset classes of VDAs, or think of them as whimsical-newbies as one’s opinion permits, we have to look at past learnings of how humans and society and ideology around finance, evolved.

For example, early caveman did not have paper or paper currency or coins or banks to save his material possessions. The then-contemporary and financially evolved early 20thcentury bankers did not trade in carbon credits or blue financing. The evolution of digital technologies moots fresher potential in building convenience and comfort for humanity, allows for global transactions including complex ones – both in terms of assets, as well as structures across a multitude of across-border-regulations. But, when new emerging technologies are the basis of newer asset classes, it worries us, and we assume the worst of them.