Since July 2018, due to a statement released by the Reserve Bank of India (RBI) in April, local banks were prohibited from dealing with bitcoin and cryptocurrency exchanges. This was an additional source of the epic bitcoin price crash.
The government has four weeks to draft a cryptocurrency regulatory framework, which would decide the legal landscape of the cryptocurrency market in India for the foreseeable future. They would then present this in front of the Supreme Court of India for the final ruling.
The March 29 hearing is set to occur four days from now and the future of the bitcoin and the whole cryptocurrency exchange market of India is on the line.
Current State of Crypto in India
The issue is the local banks working with the central bank, which essentially is the overwhelming majority of the banks in the country. Those local banks are not permitted to work with cryptocurrency exchanges.
While it may be in the regulatory grey area, it is not against the law for cryptocurrency traders to buy or sell bitcoin through local over-the-counter (OTC) exchanges and peer-to-peer trading platforms using cash, as long as it the local banks are not involved. India seems to be warming up to crypto, bitcoin and ethereum specifically. Many government officials have agreed with it, in recent months, the sentiment around cryptocurrencies has started to change.
oney laundering is the primary concern of the Indian government, it may lean towards the legalization of bitcoin and cryptocurrency trading with very strict regulations in place.