Monday, June 17, 2019

Reserve Bank of India Forces Customers to Promise to Shun Cryptocurrencies

The Reserve Bank of India has now resorted to drastic actions to discourage the usage of digital currencies in India, by introducing inevitable clauses in customers’ contract agreements.

Initial Processions

The Reserve Bank of India (RBI) has in times past not shied away from warning Indian citizens and customers from trading or investing in virtual currencies. While its authorities have declared a ‘fascinated’ respect for blockchain technology, they have certainly not found love with Bitcoin or any other altcoins for that matter.

The initial weeks of 2019, however, has seen the country’s central bank employ a more forceful approach towards the deterrent of crypto coins. Although Indian banks had in reality been stopping crypto-related purchases, RBI only made it official mid-2018, publishing an official statement:

“Reserve Bank has repeatedly cautioned users, holders and traders of virtual currencies, including Bitcoins, regarding various risks associated in dealing with such virtual currencies. In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs. Regulated entities which already provide such services shall exit the relationship within a specified time.”

The RBI has now gone on to ensure India does not subscribe to a virtual system until it is ‘developed enough’ to skirt the problems and controversies troubling him—and according to the governor, might just take two decades!

Permission to Freeze Your Accounts

The latest antic pulled by RBI might just effectively dour the rate of crypto-related activities in India. Banks in India are now imputing clauses in contracts to be signed by their customers, forcing them to promise total abstinence from cryptocurrency transactions or related ilks. The latest development, of course, is set to curb the rate of adoption of digital currencies in India, and might just finally shunt it, after the country witnessed a drop of more than 90 percent in crypto transactions compared to 2017.

Indian crypto enthusiasts are now voicing their concerns on social media pages. A user, @DesiCryptoHodlr or “Indian Crypto Girl” tweeted after posting a screenshot as evidence of the new imputed clause:

“Indian Banks now forcefully taking permission from us to ‘reserve right to close our account without further intimation’ if we deal in #cryptocurrency transactions

Ability to decide what to do with our own money is the very reason we need to invest, #BUIDL, & believe in #bitcoin.”

Cryptocurrency trading and possession is legal in India though, and has not been banned; crypto traders would only be forced to seek alternatives to exchanges such as peer-to-peer platforms.

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