The Blockchain and Crypto Assets Council (BACC), the policy body representing the interests of India's crypto ecosystem, has been disbanded by its parent, the Internet and Mobile Association of India (IAMAI), according to three people with knowledge of the decision.

The decision was taken by the IAMAI and was made without discussions with the BACC, the people said. The move was announced as a "collective decision" in a video conference call with industry stakeholders and representatives of crypto exchanges.

"We were told that the IAMAI has distanced itself from advocacy for crypto exchanges," one of the people said.

Representatives of the crypto industry asked what the disbanding would mean for the crypto industry.

"We did not get a straight answer and were simply told in a roundabout manner that this is a collective decision," the source said.

Representatives have not yet had a conversation about whether a new or separate body will be formed to be the industry's policy advocate.

The move is another blow in a series of setbacks to India's crypto industry, which has been hit by stiff taxes, payment processors cutting off exchanges, trading volumes crashing and a global bear market.

Some of the reasons for the decision included a lack of maturity among crypto founders to take matters seriously with the government, inaction around critical matters despite getting chided by India's parliamentary finance body, and the creation of a vitiating environment, a person with knowledge of internal consultations said.

The person said the IAMAI felt it was risking a reputation and credibility earned over years of working with new industries and it was time that the crypto industry gets the message.

Differences had emerged within the IAMAI and some members of the BACC on the way forward after India imposed stiff taxes on crypto trading. Some industry participants believed a legal challenge was the best way forward, a view that was not supported by the IAMAI.

"It is unfortunate that this has happened when things have become difficult," an industry source said.