Indian central bank sends mixed signals on crypto regulation


© Reuters.

By Samuel Indyk – The Reserve Bank of India (RBI) attempted to clarify its stance on cryptocurrencies overnight but instead just appeared to contradict some comments made earlier in the week.

In a press conference following the monetary policy decision, RBI governor Shaktikanta Das said there is no change in the central bank’s position.

“We have major concerns around cryptocurrency, which we have conveyed to the government,” Das said.

The comments come less than a week after the central bank clarified that its old circular banning payments related to cryptocurrencies was no longer valid.

Back in 2018, the RBI published a circular banning some cryptocurrency transactions and some Indian banks have reportedly cited this as a reason to advise against users investing in cryptocurrencies. However, following a Supreme Court ruling last year, that circular is no longer valid, leaving the door open for banks to make their own decisions regarding crypto transactions.

“References to the (old) circular by banks/regulated entities are not in order, as it was set aside by the Honourable Supreme Court on March 4, 2020,” RBI’s chief general manager Shrimohan Yadav said earlier this week.

The latest comments from the central bank are clearly an attempt to set the record straight and maybe even a hint that more cryptocurrency regulation is coming to India in the near future.

But for now, regulation of the cryptocurrency market in India has been pushed to one side with Das adding that investors need to do their own “due diligence”.

Cryptocurrencies are trading lower on Friday after tweets from Tesla CEO Elon Musk signalled that he is still having doubts about Bitcoin. Other major cryptocurrencies also declined, including Ethereum which found resistance at its 50 DMA during yesterday’s trading session.

Indian central bank sends mixed signals on crypto regulation

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