India Supreme Court Issues 4-Week Deadline for Crypto Regulation

India Supreme Court Issues 4-Week Deadline for Crypto Regulation

The Supreme Court of India has ordered the Union of India to come up with a regulatory framework for the cryptocurrency industry within four weeks. Failure to do so will prompt the Court to come up with its own judgment. To that effect, it declined to hear any case as regards the industry.

According to news outlet Inc42, “the earliest petitioner in the case (petitioner no. 2) advocate Vijay Pal Dalmia said that with today’s (Feb 25, 2019) hearing, the Court has given one more and last opportunity to the Union of India to bring in a cryptocurrency policy in place”.

The cryptocurrency industry in India has been undefined for a while now, with so many misgivings regarding the position of the government towards blockchain and the underlying digital assets. While the central bank the Reserve Bank of India (RBI) has made its stance clear about cryptocurrencies, the government was at some point in the process of establishing a government-backed cryptocurrency but later shelved its plans.

Unlike other jurisdictions like China, where a clear stance on cryptocurrency has been declared, the government of India hasn’t provided a clear thought on its stance with respect to cryptocurrencies. Instead, the RBI instructed financial institutions not to provide custody services to crypto-related ventures and have occasionally issued public warnings as regards unregulated digital assets.

Meanwhile, different proponents of the cryptocurrency industry have sought out regulatory clarity from the government and had gone as far as to petition the High Court and the Supreme Court with regards to the RBI circular that prevented banks and payment companies from providing services to customers dealing in cryptocurrency. The government had countered with its own affidavit, explaining the circular as part of its preliminary measures set up by the inter-ministerial committee on cryptocurrency regulation.

The committee had sometime earlier this month expressed its worries about crypto with regards to its national currency, the rupee, stating that it could destabilize the fiat currency in the long term should crypto be accepted as a medium of exchange.

Evidently, the crypto community in India continue to strive for industry inclusion, however, with the constraints in place, it’s hard for the ecosystem to thrive. Nonetheless, it pools resources and efforts towards educating the mass and the respective authorities on the industry to make an informed decision as regards its regulation. Meanwhile, a Right to Information (RTI) report earlier had indicated that the government was also interested in seeking outside legal help on the subject.

Four weeks from today, the crypto regulatory stance in India should be comprehensive and clear enough to know whether the government intends to support the emerging financial revolution or not.

 

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