MCX removes its comments… Will BSE/NSE take action for this Corporate Governance failure?

Yesterday, we pointed out that MCX of India Limited which manages the Commodity exchange operations and is therefore a stake holder in Bitcoin being banned or legalized had placed a comment on the MyGov.in discussion board that Bitcoin was proposed to be legalized.

MCX is an insider to the stock market operations and is carrying the permissions from SEBI and RBI to carry on its activity and is considered as a quasi regulator for commodity transactions. It is also listed in BSE and NSE.

Being an insider, it was inappropriate for MCX to release its views on Bitcoin regulation to the public on the forum unlike other private companies and individuals. Also since MCX is a company, any policy decision of this nature should have carried the permission of the Board of Directors in the form of a resolution. Also being a listed company and probably the exchange which woould be entrusted with the management of Bitcoin exchanges in India if Bitcoin is legalized, the information put out on the public platform was an attempt to influence the policy of the Government which could affect its own business prospects. Hence it was a price sensitive information both for the price of MCX on BSE/NSE as well as price of Bitcoins in the unofficial exchanges.

We therefore were constrained to raise an objection and bring it to the notice of the Directors of MCX and also the committee on Bitcoin regulation besides other relevant persons.

Also the Stock exchange had not been informed earlier and hence it was a violation of the listing guidelines of SEBI.

We expected that if the posting was from a person in MCX not authorized by the Board of MCX, suitable corrective action including disciplinary proceedings would be initiated for this breach of a  Corporate Governance aspect.

We are happy to now report that some action seems to have been initiated by MCX as indicated by the removal of the comment from the discussion board as indicated by the following two screen shots captured by Cyber Evidence Archival Center yesterday and today.


As we can observe, the comment of MCX which was between the comments of Amit Kumar Maurya and Shashank Rao is no longer there.

We appreciate the action initiated by MCX and hope it would take further action as may be necessary including issuing a press release expressing regret. BSE/NSE also needs to clarify if it has taken any action in this regard. Further the Bitcoin regulation committee also may clarify and assure that they will not be influenced by the views of MCX and it will take an independent decision in this regard.

It would be a good corporate Governance aspect if the Directors of MCX confirm that they donot have stock of Bitcoins in their possession as of now and they have no conflicting interest in the decision of the committee.

Naavi

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About Vijayashankar Na

Naavi is a veteran Cyber Law specialist in India and is presently working from Bangalore as an Information Assurance Consultant. Pioneered concepts such as ITA 2008 compliance, Naavi is also the founder of Cyber Law College, a virtual Cyber Law Education institution. He now has been focusing on the projects such as Secure Digital India and Cyber Insurance
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One Response to MCX removes its comments… Will BSE/NSE take action for this Corporate Governance failure?

  1. Pingback: Supreme Court should declare Bitcoin as illegal..to prevent Mr Modi gaining a higher moral ground | Naavi.org

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