The constant change of dates by the Supreme Court of India has left some disappointed on the outcome of the case against RBI's circular dated 6th April 2018 banning banking services to cryptocurrency exchanges.
However, in their writ petition four cryptocurrency exchanges from India have jointly filed a writ petition challenging the constitutional validity of RBI's circular. This writ petition has been filed as no. 373 of 2018 under Article 32 of the constitution.
To sum it up they have made a hard hitting response to the RBI which gives me hope that the industry might have a chance if the apex court considers these statements made against the RBI.
Past few weeks or so have been very slow moving with multiple date changes by the court. It had extremely difficult to gauge where this is going. However, I hope this will give some clarity. You can read the main points below.
Points raised in the writ petition:
- Legitimately registered and running business as per currently existing laws which was violated by RBI by discriminating against exchanges. Without any reasonable grounds defined by RBI in its circular or statement to Supreme Court.
- RBI's circular violated Article 19(1G) of the constitution of India- the right to business in India.
- While the state can impose reasonable restriction on businesses under reasonable restriction under article 19(6) but RBI imposed a complete prohibition.
- Right to life violated under Indian constitution. Right livelihood is part of Right to life and RBI has forced exchanges to shut down and lay off employees.
- Everything that is not forbidden by law is permitted. No law that has made cryptos illegal and therefore it is wrong to assume cryptos are illegal.
- Article 14 violated by RBI.
- Right to reputation (part of the constitution).
- Why was the prohibition brought in before the inter-disciplinary committee report on cryptocurrencies?
- Principle of natural justice (no prior discussion with stakeholders before prohibition)
- Part 3 of the constitution (Article 12 to Article 35) - fundamental rights have been violated and judicial review is must in this case. Because RBI had stated in its circular that no rights have been violated.
- No mention of cryptocurrencies in judicial, academic or legal definition in any financial acts including RBI act 1934, Banking Regulation Act 1949, Payment settlement act 2007. It is outside the purview of RBI's monetary policy making and hence outside purview of RBI.
- No statutory definition of VC.
- Ban hurts startup eco-system in India
- Fraudulent exercise of RBI's power.
- Risk of money laundering and terrorist funding is a risk that is present in other e-wallets as well.
- Why RBI didn't apply existing guidelines on KYC, AML and combating terrorist funding already applied to banks and other regulated entities on cryptocurrency exchanges?
- Doctrine of proportionality states that it is necessary to show fairness. RBI could have regulated or used licensing or used SEBI to regulate as it's an expert in regulating speculative markets but instead RBI banned banking services without regulation.
- RBI created FUD without explaining their prohibition and attempted to kill the growing cryptocurrency eco-system in India.
- Cryptoasset is a broad term, RBI did not define which cryptoassets are important and which ones are not when over a dozen countries are promoting blockchain and cryptocurrencies.
- More than 2 million users have been impacted by RBI's prohibition.
- RBI's decision caused loss to 250 crore daily turnover business.
- RBI's decision violates Essential services act of 1981. Banks suspended bank accounts of users involved in cryptocurrency trading including exchanges.
- Concept of reasonable restriction. No intelligence, care or deliberation applied prior to ban. No stakeholders were informed the reasons nor the research prior to ban.
As you can tell exchanges have come back with a killer response. This gives me hope for the days ahead.
Stay tuned to my blog for more updates on this matter.
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I am sure something is happening behind the curtains. The govt. sent its officials to Japan and Switzerland to study the bitcoin regulations there few weeks back. I think the supreme court verdict will come after govt. thoroughly examines the btc regulations in these countries.. Secondly, govt officials were also seen attending Bitcoin seminars across the country.. I guess it will be regulated
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India's apex court is itself creating its bad image on the globe by extending the dates since last month. Being the 2nd largest populated country in the world, our judiciary system is the slowest. How can we expect to develop while without no grounds or discussion RBI has taken such step?
Exchanges have raised valid points. There is no authority of RBI to ban cryptocurrencies. It's violation of fundamental rights given by the constitution.
Yes,dear often I think are we the citizen of a democratic country?Why we are depriving from our fundamental rights.Without prior information we are ordered to close down our transaction,or our business.These acts of RBI are not a democratic one.But we all are helpless,we have to wait until the final verdict,but until when?...Thanks for the valuable informations.
Hello @firepower, with this going on in India 🇮🇳, is it not obvious that their centralized system of government is somehow injecting venom of wickedness that sniffs right to life from masses who are trying to help themselves legitimately through decentralized system of livelihood?
This is one of the inanimate behavior that I’d love to stop from existence if it’s up to me.
we want regurate bitcoin india
for awesome trade in india
Government and SC have to accept the facts that whats going on in future of currency market and at one point of stage India will be supreme game changer in Crypto-currencies market is for sure.
India is still a game changer from last 3-4 years in the block chain technology Sir
after reading the points raised in the writ petition there is seen certainty of favourable judgement for crypto exchanges. Good going...
thanks for best information!
Banks biggest fear Crypto . Ignore as much as you can, technology will sure-shot beat Banks!
Agreed.
@firepower, Yes, for sure this Continuous Date Game is really unfortunate to see and now we are waiting for the result upon this case, and in my opinion whatever it is, we are once again receiving some positive vibes.
And great to see that these four Exchanges came up with the effective points and they strongly put their points and in my opinion they clearly wanted to convey that inturn this Ban is Violation Of Basic Rights.
And these points are hold the positive essence and now we have to wait and see. But most appreciable aspect is, no matter what the position is, these exchanges came forward and they hold the idea of developing Crypto Sphere.
Wishing you an great day and stay blessed. 🙂
I hope there will be a positive judgement, thanks for share.
Let's cross fingers and hope for best time to come soon. Indian Government must see the wind strength of the tornado
@firepower After reading important points of writ petition it seems like Indian Exchange are in attacking position, Before making any statement RBI did not study in-depth about Cryptocurrency. As we knows that more and more financial institution testing on Ripple XRP or Stellar Lumens for faster cross border payments.
What if major financial institution switch to Blockchain Technology , How Indian Banks will communicate with Those financial Institution in term of Financial Transaction? This mean RBI did not understand future impact.
If Government stick with ban on Cryptocurrency , it will isolate India with rest of the country. If Cryptocurrency regulation is an issue then RBI can regulate centralize Cryptocurrency like Ripple XRP.
As per the statement of RBI it seems like that they know only one Cryptocurrency which is Bitcoin. Government send official to abroad to study about Cryptocurrency and Blockchain implementation to other countries, it seems like that they were went on holiday tour on government money.
well as ittle as my knowledge is , i think the points are fair enough , thou i am shocked that such points are not publicly debated in the main stream media
Thanks for sharing this post..
I wouldn't see that we will get any positive results on 18th as well because lots of arguments still be discussed.
