New Twist in the Crypto Ban as Delhi HC Seeks RBI’s Stand
In a recent development in India’s ban over digital currencies the High Court of Delhi has asked RBI, Reserve Bank of India to submit its position on the plea of a crypto company. Earlier this year the Central Bank of the country technically banned digital currencies by ‘Withdrawing Banking Support to Virtual Currency Exchanges.’
A notice was issued to RBI, the GST Council and Finance ministry by Justice Rajiv Shakdher that ordered them to clear their stance on a petition that challenges RBI’s circular of April 6, 2018.
The petition has been filed by a digital currency-based trading company named Flinstone Technologies Pvt Ltd that also provides a digital wallet service for Bitcoin known as Money trade coin. It has asked the court to terminate the circular issued by Reserve Bank of India as it was “arbitrary, unconstitutional.”
Flinstone Technologies stated that RBI’s circular was devoid of practical observance as it will cause numerous people who have invested their money into the businesses related to digital currencies.
It is not the only company to file a petition against RBI’s decision to ban digital currencies. Kali Digital Eco Systems, an Indian crypto firm has also approached the Delhi High Court to strengthen the movement in crypto support. The company runs a successful crypto exchange named CoinRecoil and is gearing up for the next hearing on May 24, 2018.
On the other hand, investors in India seem positive about the future of digital currencies in the country. CEO BuyUcoin, an Indian crypto exchange, Shivam Thakral said, “There is a positive sentiment in the industry that the government will not ban trading in cryptocurrencies, and even if formal banking channels cannot be used, people can move to crypto-crypto trading platforms.
He added, “New investors are coming to our exchanges while existing ones are regaining interest after the drop because they’re getting good value and are making money as the prices of cryptocurrencies move higher.”
According to analysts, exchange operators and investors, people are trying to take advantage of the three-month window provide by RBI to settle business in the Indian crypto space. The regulatory authority has allowed people to buy as many digital currencies as they can through the Indian fiat currency. After the end of the window, crypto holders would be entitled to exchange their coins with other cyber coins without converting them to Indian rupees.
Thakral continued, “The long-term vision for us and the people who are investing now is that cryptocurrencies are here to stay.”
Crypto supporters believe that RBI’s decision is flawed as removing banking and financial institutions form the crypto space will minimize its control over the community. Without any watchdog, the industry would be used for criminal activities and terrorist funding.
Right now, it seems like that RBI decided in a hurry as it wanted to launch a fiat digital currency named ‘laxmi.’ It would be interesting to see if the court proceedings bend towards crypto community and nullify every decision taken by RBI. If something like this happens, it will be a historical first for India.