India Decides: Bitcoin’s Legality Hangs in the Balance

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India Decides: Bitcoin’s Legality Hangs in the Balance

Bitcoin has gradually seen a rather promising and interesting growth in value and usage on the global market as opposed to the initial fears and speculations of it being lifeless and myopically illusional, brushing it off with the reason of it being not feasible. Bitcoin has been a currency that’s had most of its use on the dark web (because sure, no one into shady deals will want to leave a trail behind him, and bitcoin certainly helps out with this problem). But its time on the dark web appears to have worked in its favour as it has given it so much value that some reputable companies like Amazon are even considering the possibility of making it (bitcoin) an actual payment method for their business transactions. Well that does not mean that it is now a legal currency, neither does it mean that bitcoin is also an illegal means of money transfer. See it as being like one of those plus sized android phones that are so big that they are phones and tablets at the same time (phablets): the bitcoin is more like a hybrid. But then it’s not that nice icing on the cake in every place in the world as it may sound, and India is one of these few places that have a bone of contention to pick with bitcoin.

The Legal How-Do-You-Do

Due to the lack of explicit government policies with respect to cryptocurrencies, the Supreme Court of India is currently drawing the reins of justice over a petition that seeks for clarity on the use of such cryptocurrencies. According to India’s central bank, Reserve Bank of India (RBI), “it has not given license/authorization to any entity/company to operate such schemes or deal with Bitcoin or any virtual currency.” This would imply that the Bank would not be liable for any damages one incurs with trading in cryptocurrencies, thus one partakes in such trades at his or her own expense. There have been several attempts to bring clarity to this afore mentioned stance by the bank and one of them has been that of lawyer Dwaipayan Bhowmick, who is asking very much the same thing that most people have asked for; a governmental structure put in place to modulate bitcoin’s flow, and that of other cryptocurrencies. This was captured in his petition to the Supreme Court that was filed on November 3.

The Onus Lies on Us

Certainly, the country’s lack of any dependable rules and regulations from the authorities inspired a rather thwarted bitcoin industry in India to the establishment of one such self-regulatory body. This body seems to have made quite the headway as the adoption of the “Know Your Customer (KYC)” and “Anti-Money Laundering (AML) systems seem to have worked just the deal of good for it, and has also served in ensuring more security with regards to the use of cryptocurrencies. And then came in the committee that was meant to research into the possibility of a legally regulatory framework for the flow of cryptocurrencies in the nation. This was the “Virtual Currency Committee”.

It is apparently quite evident that the petition by Dwaipayan Bhowmick not only seeks for a clarity on the equivocal statement by India’s central bank on cryptocurrencies, it even also blames it for the failure to regulate bitcoin’s flow as the RBI keeps on ignoring its responsibilities in a game of “duties-shoving” with the Security and Exchange Board of India (SEBI) as they quibble over whether to term bitcoin a ‘currency’ or ‘commodity’. The petition also comes just about a week after the RBI disclosed its plans of researching into its own cryptocurrency, a digital alternative for the traditional rupee; an effort meant to justify its uncharacteristic lack of interest in pronouncing bitcoin a healthy channel for trade conduction.