Industry watchers were thrilled on March 6 when the Indian Supreme Court lifted the Reserve Bank (RBI) ban on financial institutions that provide banking services to businesses. electronic money. However, this is not a final decision and is currently subject to 'red flags' on many issues.
In addition, the draft bill banning cryptocurrencies issued on February 28, 2019 must still be passed to Parliament. As had analysis In the past, cryptocurrencies were somewhat accepted by the court and the possibility of being legalized showed that the legal status of cryptocurrencies in India has not been completely guaranteed.
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Through a 180-page judgment of the judgment, the premise of the judgment did not match with what the industry had acknowledged.
In essence, the entire judgment is based on a violation of one of the basic rights of the Indian constitution – Article 19 (1) (g), which guarantees the freedom to practice any profession. The Supreme Court concluded that the RBI measure violated Article 19 (1) (g) of the cryptocurrency exchange and that the ban was not proportional to the threat. The ruling also concluded that the central bank could not prove a threat with empirical data or surveyed reliable alternatives.
However, one of the reasons the Supreme Court supports the industry is because “there is no law banning virtual currencies”, implying that the ruling will not be effective when such laws exist.
The court also called cryptocurrencies a “by-product” of blockchain technology and said the government could split them into two. It is the refraining from separating the blockchain and the cryptocurrency that has led to most federal policies so far.
One analysis Post-judgment details looked at other issues and discussed possible reactions immediately to the verdict.
The industry has won a tough battle and we can expect not to see the same ban again. However, legislators may soon switch to enacting the law. But, the central bank can only successfully appeal if there is sufficient reliable evidence of currency risks from cryptocurrencies.
Positive signal
Outside of the territory of financial and legislative regulators, there has been much government talk of a more progressive approach to blockchain in India.
The Federal Ministry of IT recently released Draft National strategy for Blockchain This report looks at more advanced applications of blockchain, for example making money from data and promoting building a global development center for blockchain talent in India. At the same time, it criticized policy actions, publicly announcing that “blockchain awareness in government is very poor” and that “lack of regulatory clarity” hinders the number one investor in entering. this field.
Many state-level governments, especially those with well-developed IT sectors and imprinted with startup footprints, have been actively trying to build the blockchain ecosystem. The state of Karnataka – known as the Silicon Valley of India and Bangalore has been actively seeking to build an initial project. They even conducted one of India's largest blockchain hackathons with challenges built from within government agencies and plans to turn promising ideas into practice. All organizations froze in the aftermath of the RBI and the state contacted the federal government to dialogue with a regulatory request to promote growth in blockchain.
The state of Telangana, split from the city of Hyderabad, has designated the entire area as the city's “blockchain district,” with infrastructure geared towards blockchain startups. The state of Tamil Nadu has announced The ambitious blockchain backbone for e-governance, possibly one of the largest projects in the world, including 10 million citizens. All of these states are engaged in regulatory dialogue with the federal government through internal channels.
In short, the ambiguity still persists in the future of cryptocurrencies after the Supreme Court ruling. However, in line with the size and structure of democracy in India, complex impetus is being carried out between different levels of policy in the country, with mixed opinions from both sides.
Thuy Trang
According to Coindesk
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