After all the hoopla that has been surrounding the Indian crypto scene in recent weeks, it seems as though the Reserve Bank of India (RBI) might be looking to forgo its current ban on all crypto investments.

Ban may be lifted soon

Some time back the RBI had issued a statement saying that all entities regulated by the institution were legally obliged to stop all crypto related activities. As a result of this, the local market was sent into a frenzy, especially since the alt-asset industry has been doing really well within the SE Asian nation.

However, just today a panel assembled by the finance ministry in relation to the aforementioned matter indicated to the media that there might not be a ‘blanket ban’ after all.

While the original statement released by the RBI earlier this year read that investors both ‘private or institutional’ would not be allowed to indulge in crypto trade and exchange, latest developments seem to indicate otherwise.

What seems to be the course of action looking ahead?

Following the ban, a lot of Indian crypto enthusiasts challenged the decision arguing that it was “unconstitutional on many different planes”.

In response to this, earlier today, an anonymous member of the finance ministry was quoted as saying:

I don’t think anyone is really thinking of banning it (cryptocurrencies) altogether. The issue here is about regulating the trade and we need to know where the money is coming from. Allowing it as (a) commodity may let us better regulate trade and so that is being looked at.

Additionally, in relation to this matter, former RBI Deputy Governor Rama Gandhi said:

If these (cryptocurrencies) are used to settle transactions, then it acquires the nature of currency. So that is one thing that one needs to be wary of. But if people want to invest in a commodity then that is different, because then we can assume that they are aware of the risks involved.

Final Take

Even though crypto exchanges within India are already subject to strict KYC, AML guidelines, most exchange owners within the subcontinent are further willing to help out government authorities so as to develop better systems that can prevent cases of fraud or money laundering.

In any case, it would be good to see India back on the crypto map sooner rather than later.


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