While the Reserve Bank of India (RBI) has yet to issue official guidelines on cryptocurrencies, according to a report submitted by deputy governor B.P. Kanungo, the central bank still has “major concerns” about the emerging digital assets.
The Reserve Bank of India has recently come out with a statement, warning the public on the digital currency “Bitcoin”. There are many articles doing the rounds, however, there are many people who are unaware of the situation. The RBI has warned of the possibility of Bitcoin causing financial and money laundering risks. They have also warned against the use of crypto in illegal activities. Bitcoin and other cryptocurrencies have become popular in India. Large miners have also set up shop in the country.
The Reserve Bank of India (RBI) has maintained its stance against cryptocurrencies, even after the government and the apex bank announced a plan to ban them. RBI Governor, Urjit Patel, was more than a little concerned about the crypto market’s drop since the government’s decision, but said that the ban still stands as of now. He urged the people to continue to invest in cryptocurrencies, and even said that the crypto market is still in its infancy.Reserve Bank of India (RBI) Governor Shaktikanta Das has clarified the central bank’s stance on cryptocurrencies. His statements follow a notification from the RBI informing banks that its restriction on cryptocurrencies was no longer valid and could not be enforced.
RBI still deeply concerned about cryptocurrencies
RBI chief Shaktikanta Das clarified the central bank’s stance on cryptocurrencies at a press conference on Friday. Das stressed that the RBI’s stance on cryptocurrencies has not changed: As for the RBI’s position, we have serious reservations about cryptocurrencies, which we have communicated to the government. As for investors, each of them should do their own research and make a very careful and balanced selection. This clarification follows a notification from the RBI informing banks that its April 2018 circular prohibiting banks from dealing in cryptocurrencies is no longer valid and cannot be cited. The circular was rejected by the Supreme Court of India in March last year. Still, some banks have reportedly cited circularity as a reason to stop offering services to cryptocurrency companies and traders. Governor Das continued: As you know, the Supreme Court has quashed the RBI Circular 2018, but you may be surprised to know that some banks are referring to this circular in their correspondence with customers. That is why we have had to clarify that this circular has been withdrawn, so it is completely incorrect to refer to it. HDFC Bank, India’s largest private bank with 5,608 branches and 16,087 ATMs, has sent letters to its customers threatening to close their accounts due to cryptocurrency transactions. However, local media reported that the bank had withdrawn its notification to customers after the RBI clarified its position. The bank also recently released a report stating that: We believe it is only a matter of time before Indian investors have legal access to cryptocurrencies. Meanwhile, the Indian government is still working on the crypto currency law. The existing bill, which would be introduced during the budget session of parliament, includes the ban on cryptocurrencies. However, the government is reportedly setting up a panel of experts to re-evaluate the recommendations in the bill. What do you think of the RBI chief’s clarification on cryptocurrencies? Let us know your comments in the section below. Photo credit: Shutterstock, Pixabay, Wiki Commons Denial: This article is for information only. It is not a direct offer or invitation to buy or sell, nor is it a recommendation or endorsement of any goods, services or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author shall be liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services referred to in this article.In a statement to the press, India’s central bank, the Reserve Bank of India (RBI), said it has “major concerns” about the use of cryptocurrency, despite having previously announced that it was banning them outright.. Read more about rbi cryptocurrency circular and let us know what you think.
Frequently Asked Questions
Has RBI banned Cryptocurrency?
Indian bitcoin exchange Coinsecure has announced that it has been “backstabbed” by the Reserve Bank of India (RBI), after the bank ordered its bank account to be cut off. Coinsecure’s CEO and co-founder Mohit Kalra said that the bank account was cut off after the “imposition of an arbitrary restriction” by the RBI. According to Coinsecure, the bank account was cut off after the company failed to comply with a number of guidelines set by the RBI in July. A major concern of India’s central bank (RBI) is the potential harm that could result from the proliferation of cryptocurrency. RBI has repeatedly warned investors about the risks associated with cryptocurrencies. In particular, it has pointed out that cryptocurrencies are not backed by any underlying assets, and there is no central authority that maintains control over them. RBI also said that the intrinsic value of cryptocurrencies is purely speculative, and the price of these assets are likely to fall rapidly. Finally, RBI has also said that it is illegal to deal in cryptocurrencies in India.
Why did RBI ban Cryptocurrency?
The Reserve Bank of India (RBI), the country’s central bank, has banned banks from dealing with the digital currency, according to Bloomberg . “The central bank has asked banks to stop providing services to individuals and businesses dealing with virtual currencies,” the news outlet reported, quoting a bank official. The RBI has reportedly prohibited banks from dealing with entities that deal with Bitcoins or any other cryptocurrency. This isn’t the first time the bank has barred Bitcoin. In April 2018, it said that it was reviewing the regulation of cryptocurrencies. India’s central bank, the Reserve Bank of India (RBI), recently banned banks from providing services to companies dealing in cryptocurrency. The RBI’s reasons for the ban were dubious and laughable: “A number of regulatory and legal issues have been raised in relation to cryptocurrencies. These include consumer protection, market integrity and money laundering, among others.” Yet, despite the ban, the crypto scene in India is flourishing.
Is Cryptocurrency banned in India?
“Cryptocurrency is a digital currency that is created, stored and transmitted electronically. It is a virtual currency that uses cryptography to secure and verify transactions as well as to control the creation of new units of a particular cryptocurrency. Cryptocurrency is the modern version of money or cash.” India remains a big market for cryptocurrencies, and it’s not difficult to see why. Despite a recent crackdown on some exchanges, the country is home to some of the most influential people in the cryptocurrency space. As such, there are many who believe that the government will soon change its position on cryptocurrencies and announce a blanket ban on their use.
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