The Supreme Court of India has taken down the Reserve Bank of India’s (RBI) controversial ban on banks’ dealings with crypto-related firms imposed nearly two years ago.
The court’s bench of three judges decided on Wednesday in favor of the petitions of crypto exchanges and startups.
The RBI made a decision in April 2018 to ban domestic financial institutions from providing banking services to crypto exchanges. The ban drove crypto exchanges in the country to close, move to other jurisdictions or turn into crypto-to-crypto and over-the-counter trading.
Following the ban, both public and industry-led petitions were filed to the Supreme Court after the central bank’s ban. The Internet & Mobile Association of India (IAMAI) brought a case that combined appeals to the Suprime Court. Several rounds of hearings were held from then to the recent decision of the court but in that time some exchanges had been driven to close as trade plunged.
Sumit Gupta, founder and CEO of exchange aggregator CoinDCX commented:
The uplifting of the ban by Supreme Court is going to open new opportunities for India in terms of investments, economy, and a market as a whole. As few of the surviving petitioners of the case, we are thankful to the Supreme Court for hearing our side of the story. We have always seen crypto as a potential to unlock India’s dream of becoming a $5 trillion economy.
Tanvi Ratna, CEO and founder of Policy 4.0 stated in an analysis:
What is logical to conclude is that if the verdict goes against the actions of the central bank, there might be re-thinking on the issue within our financial policymakers. There is no guarantee this will happen though, especially if the verdict only addresses the question of regulatory overreach of the RBI, and leaves sufficient leeway for policymakers to decide upon the treatment of cryptocurrencies.