Reserve Bank Of India Prohibited Banks Operating With Cryptocurrency
The Reserve Bank of India has answered to a request searching explanations for its reasons to prohibit banks operating with the cryptocurrency industry, acknowledging it carried out no research before its prohibitive activity.
In a Right to Information (RTI) query registered by a national lawyer Varun Sethi, the Reserve Bank of India was clearly questioned for the reasons behind its April prohibition that especially banned all regulated and operated financial institutions from providing services to cryptocurrency industries.
RBI affirmed it provided that it hardly thought about reaching the decision in its answer nor did it domestically or independently hold any analysis or syudy prior to enhancing the prohibition.
In fact, the central bank did not explain its appointment and simply rejected to respond on other sounding questions put forward in the information request.
The RBI as well declined to explain how it had established public risks in involving cryptocurrencies since 2013. Likewise, it resigned to reveal its take on confirming self-regulated cryptocurrency exchanges that follow KYC strandards, if it had desired an foreign expert opinion before accepting the prohibition or if it will ban Indian citizens from buying cryptocurrencies from exchanges beyond the borders of the country.
A month ago, the central bank rejected a petition approved by the Supreme Court which sought regulation to successfully legalize and acknowledge the cryptocurrency industry in the country. In practice, the RBI rejected liability in allocating a policy or framework for the new created sector, indicating that “the RBI cannot unilaterally decide for the government on the legality of bitcoins.”
Numerous cryptocurrency industries have since sent petitions at state courts disputing the RBI decision was “arbitrary, unfair and unconstitutional“. Observing an growing backlog of those petitions, India’s Supreme Court prohibited all high courts from applying further petitions against the Reserve Bank and declared all pending petitions in May.
