By Landon Manning
Although India’s supreme court has knocked down the controversial “Bitcoin ban” in the country, the state bank that imposed the ban is not planning to let the issue go quietly.
The developing saga between the Reserve Bank of India (RBI) and the crypto industry has been going back and forth for many months. The RBI has been advocating for harsh treatment toward Bitcoin-based projects and the entire concept of privately held cryptocurrencies, with the bank repeatedly tied to rumors that it would establish a “digital rupee” similar to other planned state-backed centralized crypto assets.
Although there is a considerable amount of speculation and lobbying centered around the crypto issue, the Indian Supreme Court has laid down a major verdict: the RBI’s rule that banks could not work with crypto businesses of any sort has been smacked down. In a 180-page document, the court claimed that the proposed arguments against Bitcoin (including its potential use by criminals to obscure their illicit transactions) were not sufficient to justify such repressive measures against the entire industry. Indeed, it ruled, driving ordinary crypto enthusiasts underground may only serve to increase community members’ skills at obscuring their actions.
But it appears that the RBI is not going to accept the ruling without pushback. The Economic Times reported that the bank is already moving to file a review petition of this decision. Citing claims that this decision will “pave the way for trading in virtual currencies” and, by doing so, “put the banking system at risk.”
Many factions within the crypto community will debate the extent to which the latter claim is true and may point out that it is a benefit, depending on their own views of the banking system itself. But the former claim is indisputably true. The Times also stated that many Indian crypto businesses, which moved to Singapore after the RBI’s initial crypto ban, have begun moving back into their original country and may even attempt to pursue restitution for damages from the RBI.
Either way, the fact that the RBI’s appeal is based around the claim that this will “pave the way for trading in virtual currencies” should make it clear to most audiences that their grounds to review this decision are not substantially different from their initial, losing argument to the supreme court. The court claimed in its findings that “the right to create something that doesn’t violate any existing rule” is an incredibly fundamental aspect of any functioning legal system, and that citizens have a right to participate in this young industry.
In other words, the message to the RBI is quite clear: This industry is going to open up all over India, it may very well directly and specifically disrupt your way of running business and that is not going to change any time soon.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.