Legality of Cryptocurrency (Part 2)


Legality of Cryptocurrency
Legality of Cryptocurrency

Wheather Cryptocurrency is legal or illegal?


There are two different things one is #cryptocurrency being legal and another #cryptocurrency being allowed as a legal tender. Let solve both the problem from the viewpoint of India.


First It is Legal?


The answer to that is YES.


Let me explain why. On 6th of April, 2018 vide circular no. RBI/2017-18/154 (DBR.No.BP.BC.104 /08.13.102/2017-18) Reserve Bank of India ('RBI') put #Prohibition on dealing in Virtual Currencies (VCs) (i.e is Cryptocurrencies) for all Commercial and Co-operative Banks /Payments Banks/Small Finance Banks / NBFCs / Payment System Providers (i.e. All entities regulated by the Reserve Bank) (ban on dealing in cryptocurrencies).

The Supreme Court of India #reversed a decision of the Reserve Bank of India (RBI) banning banks from dealing with #cryptocurrency exchanges. The Court found that a blanket ban was excessive and that virtual currencies did not cause any visible harm to RBI-regulated banks. The judgement provides guidance and hope for a more balanced regulation in the future.


Conclusion -  Trading in Cryptocurrencies is legal in India as of the date. 

Then what is a problem?


The problem is that #Cryptocurrency is still an illegal tender of money. now you will be wondering mean what right? let me explain


Tomorrow if I want to go shop and buy a television, I go to the shop and tell the shopkeeper to give me this television and I say him that I will give you some XYZ amount of Cryptocurrency (e.g #Bitcoin) in return is that allowed? NO, because it's not a legal tender and I have to pay in Indian Rupees only. But then you will say but still, illegal know, finish. NO, wait you can compare it with something like this even if I go to the same shopkeeper and tell pack that television for me and I say rupees right now do one thing I give you XYZ Tata Consultancy services stocks in return is that allowed? NO, because even stocks are not legal tender.


I hope now you understood the difference between cryptocurrency being legal and cryptocurrency not being allowed as legal tender in India.


Will discuss more on this topic in blog part 3 next week until then be prepared for exciting series of blog on cryptocurrency.

 
Resources -
RBI Circular - https://www.rbi.org.in
Supremer court decision - main.sci.gov.in 
Website - www.youtube.com