At the hearing on Feb. 25, the court has given one last opportunity to the Union of India to develop crypto regulation, stressing that afterwards, the Court will stop hearing crypto-related cases, including the parties who demand to reverse the crypto circular released by the Reserve Bank of India (RBI).
Released in early April 2018, the RBI’s crypto circular prohibits banks from providing services to any person or business that deal with cryptocurrencies. The circular was subsequently critically assessed by the High Court of Delhi, which claimed that the RBI’s decision to end dealings with crypto businesses violates the constitution, while the supreme court apparently continued to support the RBI ban even after hearing a number of petitions.
While the RBI has been negative to cryptocurrency adoption, the central bank confirmed its plans to consider the creation of its own Indian rupee (INR)-backed central bank digital currency (CBDC) in August 2018, but subsequently paused its plans to release the CBDC in January 2019.
Meanwhile, an Indian governmental committee has recently released a report raising concerns about the impact of cryptocurrencies on the local fiat currency in the case of crypto being adopted for payments. On the other hand, another governmental committee’s report suggested that cryptocurrencies should be legalized in the country, stressing that there is a general consensus that cryptocurrency cannot be dismissed as completely illegal.