India’s central bank told the country’s supreme court on Friday that “allowing dealings in cryptocurrencies like bitcoin would encourage illegal transactions.” Other crypto petitions being heard include one asking the government to “take emergency steps to restrain the sale and purchase of illegal cryptocurrencies.”
Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space
RBI’s Argument
The Reserve Bank of India (RBI), the country’s central bank, appeared before the supreme court Friday to defend its position regarding cryptocurrencies. RBI issued a circular on April 6 banning financial institutions under its control from providing services to crypto companies.
According to the Economic Times, the central bank told the court:
Allowing dealings in cryptocurrencies like bitcoins would encourage illegal transactions and it has already issued a circular prohibiting use of these virtual currencies.
RBI explained that crypto is “a stateless digital currency” that operates independently of a central bank such as itself, thereby “rendering it immune from government interference,” the news outlet noted.
The Financial Express elaborated that the central bank believes “it is necessary to regulate the bitcoin and other cryptocurrencies to check illegal transactions which will impact the international flow of funds.” Senior counsel Shyam Divan, appearing for RBI, reiterated that the central bank has a particular stance and other departments may have other positions.
Petitions Being Heard
Petitions against the RBI crypto banking ban are not the only ones that the supreme court is hearing. The Economic Times described:
Some petitions challenged the use of virtual currencies and alleged that they posed grave dangers to the traditional economy and they also sought framing of guidelines to regulate them … They also sought a direction for the Centre to take emergency steps to restrain the
