India’s Supreme Court Seeks Govt’s View On Cryptocurrency

News, Regulation | October 26, 2018 By:

The Indian Supreme Court has asked the government to file an affidavit related to the findings of the crypto committee it had set up to understand cryotocurrencies.

In April of this year, the Reserve Bank of India (RBI) ordered banks to refrain from providing any services to individuals or business entities dealing with or settling cryptocurrencies. The move was formally motivated by the need to protect consumers and prevent money laundering. Local crypto exchanges then filed multiple petitions, arguing that the ban violates two Articles of the Indian constitution. Article 19(1)(g), which states that citizens enjoy the right to carry on any occupation, trade or business, and Article 14, which states that there should be no discrimination between equals.

After repeatedly postponing the case, the Supreme Court finally brought it up on Thursday. RBI counsel Shyam Divan reportedly told the court that the central bank was only trying to discourage the use of cryptocurrencies and that it was essentially a policy decision, on which the government must take a call. The court reportedly asked the government to state its view on the matter within two weeks.

“The government of India had set up a crypto committee previously to understand this space,” said Nischal Shetty, CEO of Indian crypto exchange Wazirx. “The supreme court has asked the government to submit the committee report. We don’t know what the committee report contains as of now…. What we can expect is much more clarity about crypto from a government point of view. That’s a good step forward.”

Earlier this week, Debjani Ghosh, president of Indian trade association NASSCOM, said that the “illegal” status of crypto is the result of the government’s failure to keep up with innovation.

“The genesis of this problem lies in the failure of policy making not keeping pace with rapid technological changes,” Ghosh said. “NASSCOM’s focus would be to say, how do you synergize technological development and policy making. I think that will be our focus.”