For a long time, India has been known as not a very crypto-friendly environment. Its central bank – the Reserve Bank of India (RBI) cut off exchanges from the financial networks in the country in an effort to limit the adoption of the asset. This week saw the Supreme Court overruling this ban giving new hope for the industry to thrive in the country.
Despite that happening, the saga for crypto rights won’t end here. The RBI plans to appeal the ruling and expressed concerns that the removal of the ban might encourage trading thus putting the banking system at risk.
Resistance vs. Reason in the Battle for Crypto
Industry leaders have expressed their hope that this would happen to be the first step toward embracing the cryptocurrency industry in India. According to CoinSwitch’s CEO, the country has the potential of becoming one of the largest players in the industry if they only chose to.
RBI will move forward with the appeal. The ban cut off exchanges and operators from domestic banking services, leading to a collapse of the cryptocurrency industry in India.
Companies were forced to shut down or relocate their operations or change business models to give local investors access to their platforms and services. Of course, that led to the immediate filing of petitions to overrule the bank. It took a year and a half but it finally happened.
That led to immediate action on part of financial institutions that again started to allow cryptocurrency traders to link their bank accounts to exchanges. The RBI stays firmly behind its belief that such actions will put the financial system in India at risk.
The main reason for the Supreme Court to overrule the ban was that RBI failed to provide concrete evidence that the industry and trading fiat-for-crypto was damaging. It will have to provide more conclusive evidence that it would have detrimental economical and financial effects to seek success with the appeal.
The Struggle Continues
The Central Bank of India won’t be giving up this battle. According to sources, the RBI will move forward with an appeal to reinstate the ban.
The long-term goal is for India to create its own regulatory framework that will clearly define and limit cryptocurrency operations in the country. But these efforts are not focused and take too long. Locals are eager to participate, and exchanges are just as eager to enter the market with many already looking at relocating their operations back into the country.
Discussions on a legal framework have been led for years now with no apparent results. Lawmakers, legal authorities, and financial institutions seem to fail in the task of finding common ground and finally deeming cryptocurrencies legal.
If RBI succeeds in its appeal, more years in limbo is what awaits the cryptocurrency industry in India. A fact that is viewed by many as something that is more harmful then adopting the assets and allowing exchanges access to the financial networks of the country.