SC Lifts Ban on Cryptocurrency in India: Terms RBI Ban on Cryptocurrency 'Unjustified'
The Supreme Court of India allows cryptocurreny trading in India and claims that the Reserve Bank of India’s ban on dealing in cryptocurrency, virtual currencies like Bitcoin ‘unjustified’. This has been a major development in the cryptocurrency sector as RBI earlier restricted lenders from banking transaction for cryptocurrency exchanges and traders.
The apex court comments on the RBI circular, “If a central authority like RBI, on a conspectus of various factors perceives the trend as the growth of a parallel economy and severs the umbilical cord that virtual currency has with fiat currency, the same cannot be very lightly nullified as offending Article 19(1)(g)”.
However, the Article in the Constitution gives the right to practise any profession, or to carry on any occupation, trade or business, which opened the gates for the virtual currency investors and businesses in India. Thus, cryptocurrency will be boosting in India along with the digital asset already popular in global markets.
“Owing to its susceptibility to frauds, cryptocurrency faced a lot of initial backlash. However, as long as crypto-firms are maintaining thorough identity checks and performing audits (as they were doing earlier) any company should be allowed to trade. We view the lift of the ban as a forthcoming step. With the regulation now in place, Cryptocurrency firms should start focusing on deploying stronger KYC, user data privacy, and AML policies. These measures also reinforce the government’s key concerns such as financing illegitimate activities, money laundering, and terrorist financing.” - Arpit Ratan, Co-founder, Signzy, a RegTech startup said. [source: Hindustan Times]
But, the cryptocurrency companies have legitimate cause for concern, which is that on several occasions that it shared the central bank’s views on cryptocurrencies. Before all this, the government must do well to understand the benefits of cryptocurrencies and allow their use and work towards creating an effective regulatory regime for them.