RBI reminds banks of repeal of cryptocurrency ban

The Reserve Bank of India (RBI) has asked regulated entities not to rely on the repealed directive prohibiting cryptocurrency operations. The regulator’s site notes this.

According to a press release, the clarifications were prompted by reports that some financial institutions allegedly warned clients against using digital assets. As an argument, they cited RBI’s 2018 requirements.

One Twitter user posted a screenshot of a notice from HDFC Bank, in which the bank reminded customers of the cryptocurrency ban and cited the regulator.

What Is This @HDFC_Bank @HDFCBank_Cares 😒 @pushpendrakum @CryptooAdy @pankjtanwar @CryptoPointHi @cryptokanoon @CryptooIndia pic.twitter.com/rAK9guLGs7

— Rinku Saini (@RegaFlick) May 28, 2021

«Such references are inappropriate, as this document was repealed by the Supreme Court on 4 March 2020,» the RBI noted.

The RBI stressed that local banks must “continue to conduct proper due diligence on customers” in line with AML/ KYC procedures and other requirements.

In December 2020, it emerged about the decision of leading Indian banks to resume dealing with cryptocurrency exchanges and traders.

In March 2021, Reuters reported that India would consider a bill to ban cryptocurrency operations outright, which envisages criminal and administrative liability.

In the same month, authorities demanded that crypto-related companies disclose their assets.

In May it emerged the RBI is exerting pressure on banks, urging them to reassess their relationships with Bitcoin exchanges and traders.