After a noticeable increase in media clouding about the possibility of banning cryptocurrencies in India and the possibility of its official approval, the Indian Central Bank broke its silence and asked banks not to cite the circular that took place in 2018 that prevented dealing with cryptocurrency companies, and reminded banks that the country’s Supreme Court It canceled the ban last year.
In the circular issued in April 2018, the Reserve Bank of India said that banks cannot do business with any individual or commercial entities that deal with or exchange digital currencies.
Last March, India’s Supreme Court ruled that the central bank’s circular had no weight and that banks could do business with cryptocurrency firms if they so desired.
Despite the loud and clear ruling, major Indian banks continue to block cryptocurrency-related transactions.
Indian cryptocurrency trading platforms continue to challenge the Reserve Bank of India.
Last Friday, several trading platforms threatened to take the Reserve Bank of India to the Supreme Court after it emerged earlier this month that the Reserve Bank of India unofficially asked banks to cut ties with crypto companies.
Finally, the Reserve Bank of India (RBI) has come to terms with the requirements for dealing with cryptocurrencies.
Mr. Shrimuhan Yadav, Managing Director of Reserve Bank of India stated:
In light of the esteemed Supreme Court order, the circular is no longer effective from the date of the Supreme Court ruling, and therefore cannot be cited or cited.
While Mr. Siddharth Sujani, CEO of India’s crypto intelligence company, CREBACO, stated:
Today’s notice fulfills a long-awaited formality.
The Reserve Bank of India was trying to save itself from the legal headache caused by the threat of a lawsuit.
While the Reserve Bank of India (RBI) notice stated that banks can serve any clients who meet their standards, it has discouraged banks from working with crypto companies, and there is no indication that today’s notice will change much at all.
Zakhil Suresh, founder of the SuperStox cryptocurrency trading simulator, commented:
Several bank managers tell me that they are not allowing cryptocurrencies according to their internal compliance policy and not because of the RBI.
Banking policies are already hurting the industry.
Even employees’ bank accounts were frozen in order to receive some funds from cryptocurrency trading platforms.
Sujani predicts that smaller banks may now allow customers to use cryptocurrencies. He added:
This is better than nothing.
It is worth noting that small banks often have complex APIs that users need to integrate with cryptocurrency trading platforms.
But if no major banks work with cryptocurrency companies, cryptocurrency platforms will remain stuck in their place.