The Supreme Court of India is set to hear the final arguments on the petition against the Bitcoin banking ban on Wednesday. Earlier the hearing was scheduled to be held on 25th September, but due to undisclosed reasons, the top Indian court postponed it to the 26th.
In April, the RBI had directed all the banks to stop dealing with individuals and businesses dabbling in virtual currencies by July 5. The move was an attempt to ring-fence regulated entities from the risks associated with cryptocurrencies after it was observed that several companies had started dealing in over thousands of digital currencies, which the government and the RBI claim have no intrinsic value.
The ongoing battle between the Reserve Bank of India (RBI) and Internet and Mobile Association of India (IMAI) has entered its final phase before the country’s apex court. The initial hearing was cataloged on September 11, but due to the court’s backlog hearings of other cases and RBI’s deferral of filing its response, the session witnessed two consecutive reschedulings.
On September 12, RBI issued an affidavit detailing its stance on cryptocurrency, standing by its decision to stop banks servicing exchanges and other entities. In its affidavit, RBI reserved its views on the cryptocurrency ban, telling the court that no legal system defines cryptocurrencies in its current format.
The report said,
“Neither currency nor money; they can't even be considered as a valid payment system.”
Notably, RBI had argued with the Supreme Court over the people’s constitutional rights to interfere with regulatory matters. The apex bank believes IMAI, the petitioner in the ongoing case, didn’t provide any valid arguments against the crypto banking ban, which is why the honorable Supreme Court should reject their pleas.
However, they should not interfere with petitioning, a democratic process that allows each individual to be heard before the country’s lawmakers. The existing legal framework doesn’t recognize Bitcoin mainly because it is a new asset class.
Meanwhile, the RBI ban does not look enforceable enough. Indian crypto markets are either moving underground or are relying on exchange-based p2p trade to circumvent the law. They should be focused on fixing their own legislation instead of trying to influence the Supreme Court decision.