October 2, 2023

RBI Appeals Against Cryptocurrency Firm Ban

The Reserve Bank of India (RBI) plans to file a motion against a recent Supreme Court ruling that lifted the ban on cryptocurrency banking services for almost 2 years.

According to The Economic Times, RBIConcerned that a court decision could lead to the popularization of cryptocurrency trading and jeopardize the banking system. Earlier this week, the Indian Supreme Court overturned a directive from the country's Central Bank, which prohibited banks and other financial institutions from providing services to cryptocurrency companies.

Immediately after lifting the ban on cryptocurrency exchangesIndia began to accept deposits in local currency again, as well as withdraw funds. The court decision said that RBI was unable to convincingly prove the possible damage from cryptocurrency trading. And even in the event of an appeal, if the Central Bank cannot support its position with weighty arguments, the Supreme Court is unlikely to change its decision.

The central bank may run into anothera problem. Since many companies were forced to stop working after the ban, they can now demand compensation. Lawyer Abhishek Rastogi, representing one of the cryptocurrency platforms, said:

“The Supreme Court may consider the appeal of the RBI,but at the moment, cryptocurrency platforms can work in India. "Many companies went bankrupt after the ban on RBI, and now they can try to get compensation from the Central Bank."

Regulatory still exists in Indiauncertainty regarding crypto assets. In the fall of 2018, the Supreme Court demanded that the government clarify the position regarding cryptocurrencies, and there were even reports that the country would publish regulatory documents before the end of 2018, but this did not happen.