March 8, 2021

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Isn’t it over yet? The Indian Central Bank (RBI) wants to fight the Supreme Court decision

2 min read
Isn't it over yet? The Indian Central Bank (RBI) wants to fight the Supreme Court decision

In April 2018, the Indian Central Bank (RBI) issued an order to cut off cryptocurrencies from the country’s financial system. The Supreme Court lifted restrictions on cryptocurrencies in the country this week as disproportionate…

 

Isn’t it over yet?

 

RBI is not yet relinquishing its efforts to “ban” cryptocurrencies. To be precise, the reports that the court lifted the ban on cryptocurrencies are not true, in fact it was a restriction. The central bank instructed the entities (banks) not to provide any services to persons or entities dealing with cryptocurrencies (eg trading in them).

 

After almost two years, the Indian Supreme Court finally lifted this disproportionate restriction. Cryptobusinesses can start to rejoice. Or, not yet, the RBI is now filed a proposal for review, because it is worried that virtual funds could put the banking system at risk.

 

RBI doesn’t want to admit defeat

 

The main reason for the reported reaction by the central bank are fears that restarting crypto exchanges and other cryptocurrency businesses might pose a risk to the banking system. Some exchanges have already reported that they have renewed deposits and withdrawals through bank accounts following the Supreme Court ruling.

 

The crypto community in India has come to life after two years, when crypto exchanges were either forced to close, leave the country, or focus exclusively on trading cryptocurrencies among themselves. Ashish Singhal, CEO of CoinSwitch, said:

 

“This is the first step towards adopting cryptocurrencies in India, which has the potential to become one of the largest cryptocurrencies markets.”

 

However, if the central bank can persuade the court to change the judgment, the crypto industry in the country can syop on death point. One of the applicants, Abhishek A Rastogi, a partner of Khaitan & Co, stated:

 

“The Supreme Court can look at the RBI’s proposal for review, but cryptocurrency platforms can now operate in India. Many companies have even gone bankrupt after the RBI dictate and may also try to start operations in this regard. ”

 

Summary

 

We have long heard strange and often contradictory reports about the legal status of cryptocurrencies in India. Neither the politicians themselves had an overview, and once this issue was addressed in the upper house of the Indian Parliament, the so-called Council of States, it turned out that there was no law prohibiting cryptocurrencies. Subsequently, the Indian Internet and Mobile Association (IAMAI) sued RBI for illegally restricting the country’s cryptocurrency businesses. The Supreme Court has now lifted the crypto restrictions. However, it is not yet won and the central bank will try to reverse the court’s decision.

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