(6 April 2018 – India) The Reserve Bank of India has announced that regulated financial institutions can no longer legally deal with cryptocurrencies.
Bitcoin and other cryptocurrencies are not legal tender in India and any financial institutional already providing cryptocurrency services will need to end the relationships within a specified timeframe.
“In view of the associated risk, 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 [virtual currencies],” the RBI said in a statement.
India’s finance minister told lawmakers back in February that the government planned to “take all measures to eliminate the use of these crypto-assets in financing illegitimate activities or as part of the payment system.”
As with other central banks, the RBI is more open to blockchain, the technology that underpins virtual currencies, which it said has the potential to improve the efficiency and inclusiveness of the financial system.