Indian cryptocurrency exchanges has a plead, “probe and regulate us, don’t ban.”
India’s cryptocurrency exchanges are willing to open themselves up to more regulatory scrutiny, allow greater transparency, and take more measures to safeguard customers—all in exchange for a little love from the Reserve Bank of India (RBI).
In April, the RBI had directed all lenders to wind up bank accounts of cryptocurrency exchanges and also end other business relationships with them within three months.
With the current development it sounded the death knell for the bourses, which are now either being forced to reinvent their businesses or close down operations. Cornered, the firms had dragged the RBI to court; the next supreme court hearing is scheduled for July 20, two weeks after the ban comes into effect.
In its last hearing in May, the supreme court suggested that these exchanges can engage with the RBI. So, last week, a clutch of such firms sent out letters making their case against the banking regulator’s prohibitory order.
“A ban is counter-productive, therefore, we have suggested that there should be appropriate regulations that can address the government or the central bank’s concerns,” said Anirudh Rastogi, managing partner at legal firm TRA Law, which filed the supreme court petition for four exchanges and also helped them approach the RBI.
The bitcoin exchanges have requested the RBI to remove the blanket ban, saying the regulator should instead enforce it only on firms violating the norms.
“We already follow the strict know-your-customer (KYC) and anti-money laundering (AML) guidelines and we have detailed that out in the application (to the RBI),” one of the petitioners in the case told Quartz, requesting anonymity.
“Plus, we have also suggested measures that we are ready to take to improve the KYC-AML norms, such as including passport details as well. We are also ready to take any suggestion that the regulator has to offer that can address their concerns.”
Meanwhile, the Narendra Modi government has also set up a committee under Subhash Garg, secretary of economic affairs in the finance ministry, to prepare a draft law for cryptocurrencies. The panel’s report is likely to be submitted by March 2019.