It’s over. In the long-reigning battle between the Indian regulator and crypto exchanges, the Supreme court has ruled in favor of the digital asset businesses.
In its ruling, the apex court quashed the harsh order of the Reserve Bank of India (RBI) that banned all the commercial banks under its purview from offering banking services to crypto-related businesses.
Supreme Court of India has struck off Reserve Bank of India’s (RBI) banking ban against #Crypto. The Court held that RBI Circular dated 6th April 2018 is unconstitutional.
— Crypto Kanoon (@cryptokanoon) March 4, 2020
The regulator issued the circular last April, which provided an ultimatum of 3 months to all Indian banks. This crippled the previously booming crypto industry in the country.
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The ban caused a significant decline in crypto trades in the country, forcing multiple exchanges to shut their operations.
A landmark judgment
This is a landmark judgment for all crypto entities operating in the country as they can now again approach banks for services crucial for operating a digital currency exchange. The court, however, took months to make the decision as there were multiple delays in the dates of the court hearing.
Arguing in favor of crypto exchanges, lawyers also questioned the authority of the RBI in regulating digital currencies. The monetary regulator responded that digital currencies are not banned in the country in general – it has only put banking restrictions on the industry.
Meanwhile, a government-appointed panel in the country tasked with studying the digital asset industry also recommended a ban on all private cryptocurrencies and heavy fines and up to 10 years of jail for any person dealing in digital currencies.
Though the RBI ban made a dent in the Indian crypto arena, Binance entered the market with the acquisition of WazirX, a popular crypto exchange in the country.
In Israel, too, the Attorney General took a position in a court against the blanket ban of banks in providing services to crypto companies, rather they need to access each case for the risks of money laundering or other illicit activities.