Indian Central Bank to Stop Dealing With Crypto-Friendly Clients

Indian Central Bank to Stop Dealing With Crypto-Friendly Clients

The governments all over the world keep a hardline stance on cryptocurrencies, and now it’s the turn of India to officially announce its clampdown on assets, often related to criminal activities.

On April 5, the central banking institution of India notified about its new policy concerning cryptos: it is no longer going to offer any kind of services to people and businesses that are related to cyber money.

Ironically, the central bank of India, called The Reserve Bank of India, also announced its intentions to issue its own digital coin in the foreseeable future.

India Starting The Crackdown on Cryptos

The provisions of RBI have been set in the “Statement on Developmental and Regulatory Policies.” According to this document, cyber assets increase concerns over the following issues:

  • The safeguard of users
  • Market integrity
  • Money laundering and others

And that is despite the fact that the top Indian bank admitted that blockchain like technology which is behind cryptos, has potential to enhance the effectiveness of the financial system.

Nevertheless, such course of the Indian central bank could have been predicted. The country’s govt has been referring to cryptos not positively for quite a long time. For instance, at the beginning of 2018, the Finance Ministry of India excoriated BTC and its brethren for the lack of inherent value.

Then in January a group of considerable Indian banks either closed or restricted the work of cyber money trading venues’ accounts.

But that was not the end. At the beginning of February, there emerged untrue reports concerning India’s desire to taboo cryptos all over the country, which drove to a correction on the cyber money markets.

The central bank of India has made another step in tackling on users who deal with cryptos. RBI emphasized that previously it has warned all people against cryptos due to the jeopardies they carry.

“In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs. Regulated entities which already provide such services shall exit the relationship within a specified time,” stated the Indian central bank.

Time To Get Away From The Game

Quartz India, the local media, informed that enterprises would have a quarter of a year to get away from the crypto niche.

Things Are Not Going to Be The Same

The deputy-head of RBI, Bibhu Prasad Kanungo, the same day took the floor at a respected press-conference and commented on the decision. According to his words, it was done in order to protect people been in a jeopardized financial situation.

The decision was still unexpected for lots of Indian crypto-enthusiasts. Therefore, it has led to speculations claiming that India banned the cyber-coins entirely. However, that is not true. It is only the RBI, which limited the services for people, dealing with virtual money.

Nevertheless, Indians started opposing the decision, by massively signing a declaration against the restriction.