Daijiworld Media Network - New Delhi (SHP)
New Delhi, Mar 4: The Supreme Court (SC) of India has lifted the ban on the cryptocurrency trade in India. The ban was lifted on the trading of virtual currency, cryptocurrency and bitcoins. Bitcoin, the most valued cryptocurrency in the world, was down 0.39 per cent at USD 8,815. The market cap of the currency stood at USD 161 billion.
“It’s a very positive sign that has come through, something that we have been waiting for and expecting for two years now. Most of the infrastructure and bits and pieces towards the cryptocurrency was already built out over the last few years,” said Benson Samuel director of technology at Tokenyz Ventures.
The squashing of the ban will restart a lot of the companies that earlier shut their operations due to the RBI's circular.
On April 6, 2018, the RBI had virtually banned the cryptocurrency trade in India. The regulatory body also directed that entities regulated by it shall refrain themselves from dealing in cryptocurrency or provide services for facilitating any person or entity in dealing with or settling those.
Regulated entities that were already providing such services were told to exit the relationship within three months.
The RBI had earlier issued circulars cautioning users, holders and traders of virtual currencies, including bitcoins, regarding various risks associated in dealing with such virtual currencies. However, the 2018 circular was later challenged in the Supreme Court.
The Internet and Mobile Association of India, representing various cryptocurrency exchanges, had argued that trading in cryptocurrencies in the absence of a law banning those was a 'legitimate' business activity under the Constitution. The RBI could not have denied them access to banking channels to carry on such business, it said.
The central bank defended the 2018 circular insisting that it always will be against other payments systems that undermine the integrity of the banking system.
It argued that though there was no formal ban on cryptocurrencies under any law in existence in India, it had consistently been warning all those dealing with virtual currencies of the risks inherent in the term.