The Indian Supreme Court in New Delhi. Photo: The Indian Express
The Supreme Court of India asked the Reserve Bank of India to explain why it enforced a nationwide banking ban on the country’s crypto market. Photo: The Indian Express

The Supreme Court of India was scheduled to look at crypto regulation by the end of March but, according to media reports and industry insiders, has now delayed its judgment until July.

“The hearing lasted hardly a minute or so and was deferred to the second week of July,” India-based blockchain lawyer Varun Sethi told Asia Times. “The delay is owing to lack of readiness in the government and [the] upcoming general elections.”

During election campaigns, Sethi said: “No new policy can be announced. That also affects the government’s ability to come up with a policy around cryptos.”

India’s crypto-currency regulation is being drafted by a committee headed by Subhash Chandra Garg, Secretary of the Department of Economic Affairs at India’s Ministry of Finance. After a year of delays, it had been reported by Indian media that deliberations had been close to completion.

Crypto-currencies were outlawed by the Reserve Bank of India (RBI) in April 2018. The RBI explained its ban on crypto-currencies, saying it had “repeatedly cautioned users, holders and traders of virtual currencies, including Bitcoins, regarding various risks associated in dealing with such virtual currencies.”

The Indian government, much like other Asian countries, has repeatedly voiced its support for blockchain while taking a cautious approach to crypto-currencies. In Varun Sethi’s opinion, the ultimate judgment is by no means certain.

Indian regulations are generally influenced by similar regulations overseas, Sethi says. “Since there is no clear positive trends towards the development of crypto laws, we cannot expect the ultimate judgment to be very positive unless there are some massive positive global outcomes.”

While there have been positive developments in the country, with the growth of interest in blockchain, especially in education, and decentralized applications or DApps, Sethi reports a growing feeling of dissatisfaction with the speed of progress on regulatory clarity.

“The crypto community is obviously feeling frustrated because there has not been a clear hearing for almost one year. India will be slow to adopt cryptos, even though India produces 25% of the global engineers every year,” added Sethi. “Surely there is a case for the employment of a generation for blockchain engineers. It could be just like what happened in the internet era, when India became the software capital of the world.” 

In December, it was reported that Facebook planned to launch a crypto-currency focused on the Indian remittance market that would let users transfer money on Facebook’s WhatsApp messaging app. How India’s crypto-currency regulations – or lack of them – will affect those plans remains to be seen.

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