Recently, some Indian cryptocurrency exchanges sent letters to the central bank, putting forward alternatives to the RBI’s banking ban. These crypto exchanges are following the Supreme Court’s suggestion to present their cases to the Reserve Bank of India.
Back in April, the central bank of India commissioned that all financial institutions under its authority are required to stop servicing cryptocurrency exchanges and other crypto-related businesses by the next three months. However, a few exchanges took the RBI to court later on and passed their writ petitions were passed to the Supreme Court. One of the top courts in the country decided to hear all the petitions dead set against the RBI ban. The court hearing is set for on the 20th of July and ordered concerned parties to engage with the central bank to consider their requests.
The Supreme Court noted that “allowing cryptocurrency exchanges, their shareholders, traders and other individuals to present their cases within two weeks to the RBI, which will look into the issue in accordance with the law.” Quartz, a guide to the new global economy for people in business reported that: “The supreme court suggested that these exchanges can engage with the RBI. So, last week, a clutch of such firms sent out letters making their case against the banking regulator’s prohibitory order.”
A good number of suggestions were put before the RBI. As stated by the news outlet, some of the bitcoin exchanges have requested the RBI to remove the blanket ban, saying the regulator should instead enforce it only on firms violating the norms. In addition to that, one of the petitioners explained to the news agency: “we have also suggested measures that we are ready to take to improve the KYC-AML (Know Your Customers – Anti Money Laundering) norms, such as including passport details as well. We are also ready to take any suggestion that the regulator has to offer that can address their concerns.”
TRA Law’s managing partner who filed the Supreme Court petition on behalf of four exchanges told the news outlet: “A ban is counter-productive, therefore, we have suggested that there should be appropriate regulations that can address the government or the central bank’s concerns.”
Up to five writ petitions were filed and last month, the supreme court declared that no other court should accept any more crypto-related petitions and all those existing ones should be sent to the supreme court. As we speak, the government is working on the regulatory framework for cryptocurrencies. It has already set up a committee under Subhash Garg, who is the secretary of economic affairs in the finance ministry, to prepare a draft crypto law.