The Supreme court of India refused to lift the ban on the provision of financial services organizations cryptocurrency exchanges. This restriction in April has left the Reserve Bank of India (RBI).
The hearing took place on 3 July in response to the request of the Association of Internet and mobile communications India (IAMAI), which has members and crypto currency exchange. The organization, along with other cryptocurrency marketplaces and startups, has filed five petitions against the decision of the RBI. Originally the hearing was scheduled for July 20. The Supreme court has banned all other courts in the country to accept the petitions, but agreed to hold the first meeting much earlier.
In the end, as Bloomberg reports, the court, headed by Dipak Misra (Dipak Misra), rejected the petitions and did not remove the prohibition of Central Bank of India. During the hearing, the RBI said that digital currencies, including bitcoin, can’t be considered in India as cash, because the national legislation defines money as: “made of metal or existing in a different physical form, and printed by the government.”
The ban on the operation of banks and other financial institutions with cryptocurrency exchanges or are associated with the field companies of Reserve Bank of India announced in April this year. All the organizations that are already cooperating with the aforesaid companies, the regulator is obliged to terminate the working relationship for a set period — three months. The official date when the ban comes into force was appointed on July 6.
This is not the first step the Indian authorities to show their cautious attitude to the cryptocurrency sphere. In 2013 RBI issued a statement which warned citizens about the possible risks of using digital currencies. In December 2017, has issued a new warning: at this time, the Central Bank notified the inhabitants of the country that were not given official license no cryptocurrency company, and also cautioned from participation in the ICO campaigns. At the end of last year, India’s Finance Minister finally expressed a clear position of the government regarding the definition of cryptocurrency — it does not recognize bitcoin as legal tender.
In June it became known that in the near future, the authorities should adopt a regulatory framework to regulate the cryptocurrency sphere. On the bill was a special Committee formed last year to study digital currencies.
Thus, the situation in the country is heating up, and it allows the struggle of cryptocurrency companies with regulators is still unknown. Re-hearing on the prohibition of RBI is scheduled on July 20.
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