On April 6, RBI through its notice titled ‘Prohibition on dealing in virtual currencies’, mandated banks, e-wallets and payment gateway providers to withdraw support for crypto-currency exchanges and other businesses dealing with virtual currencies (VCs) in India.
Banks, in turn, forced exchanges and traders to stop using their accounts for trading in VCs. This led them to approach the Supreme Court against the regulator’s move. The case is scheduled for hearing on July 20.
Lack of proper stakeholder consultation and absence of reasonable grounds to restrict any business are the primary provisions under which the RBI notice has been challenged in the SC.
Popular crypto-currency bitcoin fell to a two-month low on Tuesday, sliding in three of last four sessions on nagging regulatory and security concerns after the weekend hacking of South Korean crypto-currency exchange Coinrail.
The original virtual currency is nearing its lowest level of the year at just under $6,000 on the Bitstamp platform. It fell to a low of $6,500 and last traded 4.7 per cent lower at $6,551.48.
So far in 2018, bitcoin is down nearly 53 per cent, after soaring more than 1,300 per cent last year.