The infamous circular from leading banks to end cryptocurrencies may have been overturned in court, but India’s central bank is showing no signs of softening its stance on cryptocurrencies.
Reserve Bank of India Governor Shaktikanta Das confirmed the bank’s position at a recent press conference following the monetary policy statement and stressed:
“We have serious concerns about the cryptocurrency that we have passed on to the government.”
The manager’s comments came after the Reserve Bank of India was asked to clarify that banks should not continue to cite RBI circulars as reasons for denying services to crypto companies. Recent media reports indicated that the document continues to substantiate banks’ reluctance to do business with divisions from the cryptosphere, despite a Supreme Court ruling that the ban was disproportionate and overturned in March 2020.
Das told reporters that the central bank wanted to “get it right,” and “this particular RBI circular has been delayed. Therefore, it is incorrect to refer to it. ” Despite the cancellation, banks remained hesitant to open up to the industry amid general uncertainty about the future of cryptocurrencies in India. This year, an anonymous source, who claimed to be a senior Indian Finance Ministry official, suggested that a long-debated general ban on cryptocurrencies could be introduced in the country.
While he was preoccupied with clarifying the terms of the circular, Das stressed that banks must continue to follow due diligence procedures when it comes to dealing with cryptocurrency-related clients. The central bank has repeatedly pointed to the risk of money laundering and terrorist financing, which it fears will facilitate the use of cryptocurrency. In parallel, she explored the potential need for a central bank-issued digital currency.