The Reserve Bank of India (RBI) has said that it had not banned cryptocurrencies such as Bitcoin in India, but only ringfenced regulated entities like banks from risks associated with the trading of such virtual instruments.
India Central Bank Says It Hasn’t Banned Crypto: The Reserve Bank of India (RBI) says it has not banned cryptocurrency usage — only the regulated avenues leading to it https://t.co/U2LY3lLNsT pic.twitter.com/IxnaeD9ld7 — Future Bitcoin (@Future_Bitcoin) January 23, 2020
“Firstly, the RBI has not prohibited VCs (virtual currencies) in the country. The RBI has directed the entities regulated by it to not provide services to those persons or entities dealing in or settling VCs”
In an effort of regulation, RBI issued a statement in April 2018, limiting services to anyone participating in crypto-asset usage.
The RBI statement said:
“In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs.”
However, after the RBI’s statement, the Internet and Mobile Association of India (IAMAI), a non-profit group dedicated to digital growth, petitioned for a reversal of the crypto-related regulation, reported in July 2018.
Thus, on January 19, 2020, it has been reported on a recent Indian Supreme Court hearing that the court cited January 21 as the expected date on which RBI will provide further clarity on the situation.