After hearing the arguments against the banking restriction by the Reserve Bank of India (RBI) in detail, the Indian supreme court directed the central bank to reply to the representations filed by crypto exchanges. Since the RBI has not adequately answered them, the court set a new date to resume hearing the case.
The Crypto Hearing Resumes
The Supreme Court of India resumed hearing the case against the crypto banking ban by the central bank Wednesday, after spending all day on it the previous day. Senior Advocate Shyam Divan, counsel for the central bank, continued to defend the RBI’s power to issue a banking ban. He started off by reading the disadvantages of cryptocurrency from the interministerial committee (IMC) report, Indian news platform Crypto Kanoon reported from the courtroom, elaborating:
The judge interrupts and asks how you [RBI] are concerned with consumer protection, it is not your concern. It is [the] government’s concern and not yours.
Divan explained to the court why a ban is appropriate, then discussed the IMC recommendations and various crypto warnings issued by the central bank. He reiterated the point he made yesterday that the ability for cryptocurrency to be used for cross-border payments could undermine the country’s monetary policy. The RBI counsel proceeded to discuss the use of cryptocurrency in illicit activities, noting its “anonymity.” He cited a July 2018 report by the Financial Action Task Force (FATF) and the May 2018 European Union directive.
India’s Payment and Settlement Systems Act 2007, the RBI Act and the Banking Regulation Act were examined. The counsel explained that the former gives the RBI power to issue policies to manage or operate its payment system,