Before 2012, <a href="https://www.cryptoknowmics.com/news/future-of-cryptocurrency-in-india/" target="_blank" rel="noopener">cryptocurrency was not so popular in India</a>, but as Bitcoin gained traction in the market the exchanges decided to start operating in India too. From the year 2012 to the year 2017, the cryptocurrency was being traded smoothly in the country. However, the Reserve Bank of India was not totally in favor of <a href="https://www.cryptoknowmics.com/news/indian-government-planning-legal-framework-to-ban-crypto-trading/" target="_blank" rel="noopener">crypto trading</a>, therefore in the year 2013, it published a press release cautioning the audience against dealing in cryptocurrencies.  

Initially, most of the Indian citizens did not rely on digital currency, but in November 2016, when the high-value currency notes in the country were demonetized, the Government of India advised its citizen to use the digital payment method for processing the transaction. The very next year, Bitcoin touched its all-time high, and people who were technically able also started trading and investing in crypto.

However, until 2018 the majority of the countries were quite unsure whether to regulate crypto or completely ban it, and with time most of these countries whether it was the US, European nations, or even countries in the sub-continent. When the rest of the world was organizing research studies towards the use and <a href="https://www.cryptoknowmics.com/news/analyzing-coronavirus-adverse-impact-on-cryptocurrencies/" target="_blank" rel="noopener">impact of cryptocurrencies</a>, the Indian central bank RBI released a circular prohibiting all regulated banks from offering their service to crypto startups and service providers.

Later in the same year, a high-level Inter-ministerial Committee was constituted by the Indian Government to analyze the various issues related to the digital asset.  The committee was tasked form certain regulations around crypto so that the courts in the country can deal with cases related to crypto scams.
<h2>Banking Ban on Crypto by RBI</h2>
According to the circular DBR.No.BP.BC.104/08.13.102/2017-18, released by the Central Bank of India, the Commercial and Co-operative Banks, Payments Banks, Small Finance Banks, NBFCs, and Payment System Providers would not deal in cryptocurrencies. In its notification, the RBI specified that the step had been taken to prevent the consumer interest and money laundering in the country. The banking ban on crypto imposed by the Central 

Soon after that, the crypto business in India started declining, as the exchanges were not able to send or receive money to/from their users. Converting cash into crypto or crypto into cash was the main operation of exchanges but after the RBI’s ban, neither the platform was able to pay its customers nor those employees who had been working for the exchanges, because it did not have the access to banking services.

Many of the crypto exchanges operating in India were the member of the Internet and Mobile Association of India (IMAI), so on May 15, 2018, they filed a petition in Supreme Court of India indicating the problems and loss they had been facing due to the ban.
<h2>No Research No Planning</h2>
During the investigation, it has been found out that without any research or planning the <a href="https://www.cryptoknowmics.com/news/india-central-bank-rbi-reveals-plans-to-create-sovereign-cryptocurrency/" target="_blank" rel="noopener">Central Bank of India imposed the banking ban</a>. 

At the time of the hearing, the SC advised the crypto exchanges to ask the RBI to look for an alternative option that could help them start trading in India again. Taking the SC’s advice, the exchanges drafted a letter regarding it. 

One of the petitioners representing the crypto exchanges against RBI in the SC has stated, 
<blockquote>“We are ready to take to improve the KYC-AML [Know Your Customer – Anti-Money Laundering] 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.”</blockquote>
<h2>Supreme Court Of India Revoked Banking ban</h2>
The Supreme Court of India on 8th March ruled against the banking ban on crypto imposed by RBI calling it unconstitutional which brought a new lease of life I the uncertain Indian crypto ecosystem.

It has been noticed that since the ban has been uplifted from the banks the trading of cryptocurrencies in the country has seen significant growth, especially during the pandemic time. The Indian startups and entrepreneurs have to be thanked equally for the progress that the ecosystem has made given they continued their efforts to establish a dialogue with the government. WazirX and CoinDCX, the two prominent exchanges have already initiated an education portal to spread the awareness and bust the myths.

In recent times the peer-to-peer marketplace for Bitcoin is growing in India, we can see som many new crypto exchanges have been introduced since the day, the ban has been lifted by the SC.

But some of the economists are believing that soon India would face the worst recession in its history because of the nationwide lockdown.
<h2>Indian Government Looking For a Blanket Ban on Crypto?</h2>
The coverage of cryptocurrency in India by mainstream media houses is also a key reason behind the lack of awareness among the common public. For example, the banking ban imposed by the RBI was reported as a complete blanket ban which was far from the truth. In fact, crypto was never banned in India.

Now, another report of a possible banking ban on crypto is being circulated in the media based on a parliamentary note asking for a blanket ban.  The report stated that the finance ministry has also initiated an inter-ministerial consultation.  If the inter-ministerial consultation approves that note then it would be moved forward to the cabinet and then to parliament. The plans of a blanket ban by the Indian government has been doing the rounds even before the supreme court hearing for <a href="https://www.cryptoknowmics.com/news/indian-supreme-court-overrules-rbis-banking-ban/">RBI's banking ban</a>, however, nothing concrete has surfaced.

Even if the government thinks of a blanket ban on crypto in India, the only way then they must take advice from the stakeholders of the ecosystem. Because a permanent blanket ban would only create a void which would lead to a black market. However, unless anything concrete surfaces it's better not to speculate.

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Did the Supreme Court's revocation of RBI's ban on crypto trading actually pave way for a lasting government ban on cryptocurrencies?

Since the blanket ban has been lifted by the SC of India, the trading of cryptocurrencies in India is increased by 500 percent.

Jyoti is a graduate from GGSIPU and has done her PG Diploma in English Journalism from IIMC. Presently, she is working as a content writer with Agio Support Solution Pvt. Ltd. Her aim is to provide informative content about cryptocurrency and blockchain, to the tech-enthusiasts.

Did the Supreme Court's revocation of RBI's ban on crypto trading actually pave way for a lasting government ban on cryptocurrencies?

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