No RBI directive that goes against Supreme Court ruling on cryptos

The Reserve Bank of India has not given any instructions or issued any directives to entities regulated by it regarding virtual currencies that go against the Supreme Court ruling on the matter , said people in the know.

In a circular issued last May, RBI asked banks and other regulated entities to not cite its April 2018 circular that imposed restrictions in dealing with virtual currencies, after the apex court shot it down in its ruling in March 2020.

Rather it asked regulated entities to carry out due diligence in line with regulations governing Know Your Customer (KYC), Anti-Money Laundering (AML), Combating of Financing of Terrorism (CFT) and Prevention of Money Laundering Act, (PMLA), 2002, “in addition to ensuring compliance with relevant provisions under Foreign Exchange Management Act (FEMA) for overseas remittances.”

The directions of May 2021 were interpreted by many in the crypto industry as the RBI’s subtle message to regulated entities that they can offer their services to crypto exchanges.

Earlier this week, Coinbase’s Chief Executive Officer Brian Armstrong made the tussle between the RBI and the crypto industry public by suggesting that the company disabled UPI payments on its platform due to informal pressure from the RBI.