The Reserve Bank of India (RBI) has once again expressed its solid stance against digital currencies. The Asian country happens to be one of the few countries that has declined acceptance. The RBI has held on to its position on the recently viral circular.
The court is believed to have declared the circular null and void, however the RBI hasn’t been appreciative of cryptocurrencies yet. The viral circular had earlier called on Banks to suspend crypto-related transactions. RBI had mentioned plans to look into creating its own digital currency on April 5th.
Shaktikanta Das, the governor of the Reserve Bank of India maintained that the institution holds strong reservations to cryptocurrencies. Das went further to say that the RBI has shared its concerns with the government. He also stressed that it hasn’t given a go-ahead to banks to handle the transactions of cryptocurrencies yet.
RBI’s Hostility to Cryptocurrencies
Crypto lovers in India heaved a sigh of relief after the RBI made a statement asking banks to quit citing its initial circular. According to the Bank, the circular had been ruled off by the Supreme Court in March 2020. However, it didn’t mean a “yes” for cryptocurrencies, rather it was intended for banks that withheld services to cryptocurrency entities.
The RBI is striving to withhold banks from citing the flagged circular as a relevant public notice. However, several banks in the country are still reluctant to open their doors for the crypto industry due to regulatory uncertainties. Speculations are spreading that the situation might trigger a full ban on crypto in the country.
The probability of money laundering and the finance of terrorism stands as paramount reason why RBI isn’t yet embracing crypto. While exploring the possibility of a CBDC for the country, RBI expects banks to handle crypto clients with due diligence.