Tuesday, October 12

Central Bank of India Announces No Ban on Cryptocurrencies

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The Reserve Bank of India (RBI) has announced that banks cannot close their customers’ accounts for dealing with cryptocurrencies.

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The Reserve Bank of India has clarified its stance on cryptocurrencies, claiming that there are no bans on banking services for accounts dealing with cryptocurrencies. It also allowed banking institutions to conduct due diligence processes for customers involved in digital assets:

“However, banks, as well as other designated entities, may continue to conduct their customer due diligence processes in accordance with regulations governing standards for: Know Your Customer (KYC), Anti-Money Laundering (AML), Combating the Financing of Terrorism (CFT), and for overseas remittances. In addition to ensuring compliance with relevant provisions under the Foreign Exchange Management Act (FEMA), Anti-Money Laundering Act (PMLA).”

In the past weeks, major banks such as HDFC Bank and SBI Card have formally warned their customers not to make cryptocurrency transactions, citing the RBI’s 2018 circular. But the central bank points out that the circular is no longer valid:

“In this respect, according to the decision of the Court of Cassation, since the circular loses its validity from the date of the Supreme Court decision, it cannot be cited.”

A recent report from The Economic Times stated that the Indian government will reconsider its brutal plan to ban the holding, trading and mining of cryptocurrencies.

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