New Crypto Rule Raises Eyebrows: Existing Players Get to Decide Who Can Enter the Market

A new regulatory proposal is making waves in the global crypto industry—and it could change how new exchanges and service providers enter the market. Under the suggested rule, existing platforms would have a say in approving or rejecting new players. While this move is being positioned as a way to maintain standards and prevent fraud, critics are raising concerns about fairness, competition, and the potential for monopolies.

How the Rule Works

The idea is simple on paper: if a new crypto platform wants to operate, it would need approval not just from the regulator, but also from established market participants. This could be in the form of a review panel made up of current exchanges, wallet providers, and custodians.

The stated goal is to create a safer and more compliant crypto ecosystem by letting experienced players judge whether newcomers are trustworthy and technically sound.

Concerns Around Fair Competition

While the proposal may seem like a step toward tighter oversight, it raises serious questions about competition. Why should companies already in the market decide who else gets to join? That’s like asking one restaurant chain to approve new restaurants opening nearby.

There’s a fear that dominant exchanges might block smaller, innovative startups simply to reduce competition. This could stifle new ideas, limit user choices, and keep fees high.

Impact on Indian Users and Startups

For Indian crypto startups—especially those outside metros and in Tier 2 cities—this rule could become a major barrier. Young entrepreneurs from places like Indore, Surat, or Bhubaneswar already face enough hurdles in terms of funding, legal clarity, and access to experienced tech teams. Adding the need for approval from big-name competitors could shut the door on many of them before they even begin.

And for users, less competition could mean fewer options and slower innovation in features, security upgrades, or lower trading fees.

The Balance Between Safety and Monopoly

Supporters of the rule argue that bad actors in crypto have caused massive losses over the years, and any measure that filters out risky players is worth considering. But there needs to be a clear framework that ensures decisions aren’t biased or influenced by profit motives.

Independent third-party evaluations, transparent approval criteria, and the ability to appeal rejections could make the rule more balanced, if it goes forward.

Conclusion

Letting existing crypto platforms decide who gets to enter the market is a bold move—and one that could reshape the industry. While the idea of peer-reviewed entry has its benefits, it risks handing too much power to those already in control.

For Indian users and innovators, especially those in smaller cities where crypto is rapidly catching on, the need for open, fair, and secure access to this space has never been more important