Reserve Bank of India (RBI) Governor Shaktikanta Das has clarified the central bank’s position regarding cryptocurrencies. His statements followed a notice issued by the RBI to banks saying that its crypto banking ban is no longer valid and cannot be cited.
RBI still has major concerns about crypto
RBI Governor Shaktikanta Das clarified the central bank’s position on cryptocurrency at a monetary policy press meeting on Friday. Emphasizing that “there has been no change in the RBI position” regarding cryptocurrencies, Das said:
As far as the position of RBI is concerned, we have major concerns regarding cryptocurrency, which we have conveyed to the government. And, with respect to investors, it is up to every investor to do their due diligence and to take very careful and prudent calls.
After this explanation a notice Posted by RBI telling banks that its April 2018 circular that banned banks from dealing in cryptocurrencies is no longer valid and cannot be cited or quoted.
The circular was quashed by the Supreme Court of India in March last year. However, several banks are reportedly still citing the circular as the reason for stopping providing services to crypto businesses and merchants.
Governor Das continued:
As you know, the Supreme Court struck down the RBI circular issued in 2018, but it was surprising that some banks are referring to that circular in their correspondence with their customers. Therefore, we had to set the record straight that that particular circular has been set aside, hence it is not correct at all to refer to that circular.
HDFC Bank, a leading private bank in India with 5,608 branches and 16,087 ATMs, was sending letters to its customers threatening to close their accounts due to crypto transactions. However, local media reported that the bank withdrew its communication to customers after the RBI clarified its position.
The bank has also recently released a report by stating“We think it is a matter of time before Indian investors have legal access to crypto plays.”
Meanwhile, the Indian government is still working on the country’s crypto bill. The current bill, which was to be introduced during the budget session of Parliament, proposes to ban cryptocurrencies. However, the government is reportedly setting up an expert panel To re-evaluate the recommendations in the Bill.
What do you think about the RBI governor’s clarification on cryptocurrency? Let us know in the comments section below.
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