Indian banks have relaxed restrictions on the trading of Bitcoin and other cryptocurrencies via their pathways.
The shift occurs after the Supreme Court has struck down RBI’s April 2018 circular. The circular advised banks to warn their customers against investments in cryptocurrencies.
The latest step will contribute to the acceptance of cryptocurrencies in the nation, which already has significant momentum.
Relief to Crypto Investors
In a significant relief to the cryptocurrency investors around the nation, the Indian banks removed limitations on their channels. This is under government law to acquire Bitcoin and other cryptocurrencies learned Inc42.
Reliable reports indicate that the tone of the Indian banks had changed based on a previous Reserve Bank of India (RBI) ruling. The ruling states banks do not refer to their April 2018 circular to advise against crypto-currency investing. Additionally, to reject crypto-monetary services.
The Central Bank’s circular in 2018 said this given the related risk.
RBI regulatory authorities must not deal with virtual currencies or offer services to facilitate the management or settlement of virtual money to any person or business dealing with VCs.
Such services included maintaining, registering, trading, resolving, clearing, providing virtual tokens loans, taking them as guarantees, creating exchange accounts and transferring/receiving money in VC purchase/selling accounts.
“Regulated entities which already provide such services shall exit the relationship within three months from the date of this circular,” it had said.
However, the Supreme Court in March 2020 permitted banks to continue facilitating traders and exchanges’ crypto-currency transactions. Therefore, providing cripple investors with a breakdown.
The New Crypto Bill
The newest action by banks occurs while the Indian government formulates the new cryptocurrency Bill.
The clarification from the RBI was provided by the media reports that several banks and regulated companies have warned their clients of virtual currency (VC) trading. Therefore, by referring to a circular of the RBI of 6 April 2018.
The RBI notification reads.
“As such, given the order of the Supreme Court. The circular is no longer valid from the date of the Supreme Court judgement. Therefore cannot be cited or quoted from.”
BTC Adoption in India
India adopts Bitcoin and other cryptocurrencies more and more. Reports suggest that the country presently has over one crypto-investor, with many domestic exchanges active in the country rising considerably every day.
But the Indians still control less than 1% of the BTC in the world.
Bitcoin is once again floating about the threshold of $47,000 (for one single coin, more than INR 34L). With a market value of about $900 billion, the most popular cryptocurrency is traded in the Green.
According to its governor, Shaktikanta Das, RBI will also begin its first digital currency testing programme before the end of the year.