SC allows trading in virtual currency
On Wednesday, the Supreme Court, led by a three judge bench of Justices Rohinton Nariman, Aniruddha Bose and V Ramasubramanian, lifted the ban on trading in cryptocurrency imposed by the Reserve Bank of India in April’18.
Cryptocurrencies are virtual currencies in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, functioning independently of a central bank. Bitcoin is the largest & the most popular of these digital currencies.
The order on trading in virtual currency was a response to a plea by the Internet and Mobile Association of India (IMAI) objecting to the RBI ban. The industrial body lobbied that the move effectively banned legitimate business activity via virtual currencies. It had also debated that not strictly currency and was more in the nature of commodity, and the RBI does not have powers to impose such ban in the absence of a law in that regard prohibiting cryptocurrency. The central bank, on its part, had contended that it had, right from 2013, been cautioning users of cryptocurrencies and that it considers cryptocurrency a digital means of payment which has to be nipped in the bud so that the payment system in the country is not sabotaged.