Four more exchange platforms have challenged Reserve Bank of India’s (RBI) prohibition of facilitating Bitcoin and other digital currencies transactions.
This is the third and most significant challenge yet to the ban that has seen banking services to cryptocurrency exchanges entirely blocked off. The platforms that filed the case include Coindelta Exchange, Koinex Exchange, Throughbit Exchange and CoinDCX.
As reported by Mohammed Danish, a practising lawyer at the High Court of Delhi in India, the case has been filled as a Writ Petition (Civil) no. 373 of 2018 under Article 32 of the Constitution, challenging the constitutional validity of RBI’s case.
The new policies adversely affect the business interests of exchanges and start-ups; the first two Writ Petitions came from two such entities that are seeking to protect the right to carry on trade, and rights to equality that are guaranteed in the Indian Constitution.
The initial two Writ Petitions filed in public interest with the Supreme Court are still pending, but will decide the legal status of cryptocurrencies in India. They are representative of the enormous public outcry against RBI’s dictum, as the population of India is well known for being both highly aware and active in the cryptocurrency market. It was reported by Finance Magnets in January this year that India was responsible for 10% of all Bitcoin transactions worldwide.
All three of the Writ Petitions are likely to be heard in Court on 11 May 2018.
The initial restrictions to crypto services
Last month on 6 April, RBI officially directed regulated banks and payment platforms to no longer provide services to cryptocurrency operations, effective immediately. The reasoning from RBI behind this move cited digital currencies as ”[coming] with associated risks‘, following the restrictions from HDFC and Citibank both restricting clients from purchasing Bitcoin via their debit and credit cards.
The initial statement from RBI reads: ”Such services include maintaining accounts, registering, trading, settling, clearing, giving loans against virtual tokens, accepting them as collateral, opening accounts of exchanges dealing with them and transfer/receipt of money in accounts relating to purchase/ sale of VCs.”