The Supreme Court has refused to grant interim relief on an RBI order banning all regulated entities including banks from dealing in virtual currencies, proving to be a setback for cryptocurrency exchanges and investors alike. On April 6, a circular by the central bank prohibited entities regulated by the RBI from "providing any service in relation to virtual currencies, including those of transfer or receipt of money in accounts relating to purchase or sale of virtual currencies". While the central bank stopped short of banning cryptocurrencies entirely, the move severely restricted consumers’ ability to either purchase or sell cryptocurrencies like Bitcoins. Towards the end of June, Zebpay, the largest cryptocurrency exchange in India, warned its users that they may soon be unable to cash in on their earnings and the exchange "may not be able to honour withdrawal requests." “While our industry is challenging this [ban] legally, the outcome is beyond our control,” the exchange warned in a banner on its website. Back in May, the SC had ruled that all cryptocurrency-related cases be clubbed together and fixed July 20, 2018, as the date for the hearing. But the case was brought forward as an industry body said the RBI ban will come into effect by July 6. The SC had then set the hearing for July 3. No consultation or committee In June, an RTI response from the RBI showed that the ban was not backed by public consultation or independent research. Filed by a startup consultant, Varun Sethi,…
