Reserve Bank of India Denies Knowledge, Involvement in Draft Bill to Ban Crypto Entirely

The Reserve Bank of India (RBI) has denied having any knowledge or involvement in a draft government bill that would ban cryptocurrencies, an official document released on June 4 shows.

Varun Sethi, a lawyer specializing in blockchain, filed a Right to Information request with the RBI following a report by India media outlet the Economic Times in April that suggested several government departments have backed a complete ban on the “sale, purchase and issuance of all types of cryptocurrency.”

Although the RBI refused to answer some of Sethi’s questions, the bank confirmed it has had no communication from central government about the proposed law — and said it had not received a copy of the draft bill.

The bank refused to be drawn in on whether it was the relevant authority to take a decision on banning cryptocurrencies. However, the RBI said it has not endorsed such a ban to any government department, and that it had not received any written communication to suggest a government department endorsed such a move.

Sethi asked whether it was possible that such a draft bill could be passed without the consent of the RBI, but the bank declined to answer.

The RBI’s has played a central role in regulating cryptocurrencies and blockchain, as well as issuing advice to investors.

In April, the organization unveiled a regulatory sandbox that would enable blockchain products to be tested on a small number of consumers, but cryptocurrencies, exchanges and initial coin offerings were excluded. The decision prompted lobbying groups to urge the RBI to reconsider.

The world’s second-most populous nation has been slow to take a stance on cryptocurrency regulation, and the uncertainty has resulted in the closure of several Indian exchanges.