After the Supreme Court of India nullified the ban on crypto transactions imposed by the Reserve Bank of India (RBI), the bank’s plan now is to file a petition against the ruling.
It seems the RBI has worries that the latest decision coming from the court can lead to cryptocurrency trading and pose risks for the banking system in the country. The Supreme Court’s nullification took place on March 4 and made the many local crypto businesses very happy. RBI’s ban was enforced in July 2018.
Industry Players and the Public Signed Petitions
What brought the case to the Supreme Court were the petitions signed by the public and industry players and filed by the Internet and Mobile Association of India (IAMAI), a non-profit industry organization that represents investors and internet consumers. The Supreme Court made the decision to lift the ban after conducting 2 weeks of hearing in January, but the RBI is determined to have a review of the ruling.
The Banking System Not at Risk
As said before, the RBI is concerned that crypto trading may represent a problem for the banking system, but this matter is debatable. Within only 24 hours after the bank’s ban has been lifted, many crypto exchanges in India resumed their fiat withdrawals and deposits.
The Supreme Court decided there’s no proof that cryptocurrency trading can damage the banking system in any way. Unless the RBI brings such proof, it’s very unlikely for the Court to change its decision, no matter how much the bank protests. Here’s what Abhishek Rastogi, lawyer for one of the crypto platforms, said about what may happen in the future:
“The Supreme Court may look at the RBI’s review petition but as of now the cryptocurrency platforms can operate in India. Many companies have even gone bankrupt after the RBI’s diktat and they may also look to initiate action in this regard.”
Therefore, the RBI may need to focus on this issue, seeing many crypto companies ceased trading after its ban was enforced.