The Reserve Bank of India has experienced a lot of negative attention lately for the multiple cases brought against them. There are a total of five petitions that have been brought to the case, in which the forbid their partnered financial institutions that prevented them from engaging in crypto businesses.
However, in the process of working towards this case, the Supreme Court has barred any other court from accepting a petition in relation to crypto bans in the future. That means that this directive cannot be issued by another financial institution against their partners.
No Consultation With Stakeholders
Of the five petitions, two of them came directly from the Delhi High Court and the Calcutta High Court, which were processed through India’s Supreme Court. The biggest complaint in these two petitions is that RBI took no time or effort to see what their stakeholders wanted.
Anirudh Rastogi, a managing partner at TRA Law, helped file on behalf of one of the petitioners, and said:
“One of the key arguments [laid] out in the petition was that the circular was not preceded by any stakeholder consultation, which is what the latest order gets to.”
The petitioner will have two weeks to bring up their issues with the circular that RBI issued to their partners. This opportunity helps petitioners to express their interest in self-regulation and the ability to bring Know Your Customer and Anti-Money Laundering to the table.
The circular focused on keeping their financial institutions from associating with crypto business, as stated above. However, it also contained a stipulation for any of the institutions that continued to associate or already had connections – that they had three months to end those relationships. They only had until July 5th, 2018, or their partnership with RBI would be dissolved. While this move elicited fears that the whole country would eliminate cryptocurrency, no steps have been made towards this change.
Another one of the petitioners is Flintstone Technologies Limited, who setup the petition filed through the Delhi High Court. Their petition aimed to argue against the directive issued by RBI, saying it was unfair and unconstitutional. They also cited the lack of reasoning, though they ignored the lack of notification to stakeholders.
The Internet and Mobile Association of India (IAMAI) is a nonprofit organization, which is primarily meant to stand up for consumers that have interest in mobile and online services. Some of the top crypto exchanges in the world participate in the organizations, like Zebpay, Unocoin, and Coinsecure.
There were four other exchanges that created a petition for themselves as a group, which includes Coindcx, Coindelta, Throughbit, and Koinex.