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(Kitco News) - BlackRock continues to engage with the blockchain industry as the world’s largest asset manager announced a new partnership with India’s Jio Financial Services Limited to form Jio BlackRock.
Jio BlackRock is “a 50:50 joint venture that combines the respective strengths and trusted brands of BlackRock and JFS to deliver tech-enabled access to affordable, innovative investment solutions for millions of investors in India,” BlackRock said in a press release.
The new venture will combine BlackRock’s expertise in investment management, risk management, technology, operations, and intellectual capital around markets with JFS’ local market knowledge, digital infrastructure capabilities, and execution capabilities to introduce a new player to the India market with “a unique combination of scope, scale, and resources.”
The two firms are looking to attract initial investments of $150 million each in the joint venture. Jio BlackRock plans to launch operations once it receives the required regulatory and statutory approvals.
“India represents an enormously important opportunity,” said Rachel Lord, Chair and Head of APAC at BlackRock. “The convergence of rising affluence, favourable demographics, and digital transformation across industries is reshaping the market in incredible ways.”
“We are very excited to be partnering with JFS to revolutionize India’s asset management industry and transform financial futures,” she added. “Jio BlackRock will place the combined strength and scale of both of our companies in the hands of millions of investors in India.”
Hitesh Sethia, President and CEO of JFS, said Jio BlackRock will be a “truly transformational, customer-centric and digital-first enterprise with the vision to democratize access to financial investment solutions and deliver financial well-being to the doorstep of every Indian.”
India has maintained a hard-line stance toward the blockchain industry, adopting a slow, measured approach to regulation and integration.
In February, Indian Finance Minister Nirmala Sitharaman presented India’s 2023 budget, which left in place the crypto tax rules established the year prior that levy a 30% tax on all crypto profits and a 1% tax deducted at source (TDS) on all crypto transactions.
In addition to maintaining the high taxes, the government also added stipulations that could potentially lead to a fine or jail time for non-compliance with the TDS provision. The fine would be equivalent to the tax liability of the transaction while offenders also risk the possibility of spending up to 84 months in jail for failure to comply.
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In March, the Indian government officially added digital asset-related activities to the list of behaviors that must follow anti-money laundering (AML) rules, which means crypto exchanges, NFT marketplaces and custody service wallet providers are now legally responsible for monitoring suspicious financial activities.
All businesses that facilitate digital asset transactions are required to register with the Financial Intelligence Unit (FIU) and comply with other mandatory processes under the Prevention of Money Laundering Act (PMLA).
As part of the requirements of the PMLA, financial institutions are obligated to maintain a record of all transactions for the last ten years, provide these records to officials on demand, and verify the identity of all clients.
And in its role as president of the G-20, India is working with the International Monetary Fund (IMF) and the Financial Stability Board (FSB) to develop a regulatory approach for cryptocurrencies. During an interview in February, India's Finance Minister Nirmala Sitharaman said that the G-20 is looking to establish a set of global standard operating procedures that can be agreed upon by member nations for the regulation of crypto assets.
