On March 4, 2020, a Supreme Court Bench set aside a ban by the Reserve Bank of India (RBI) on banks and financial institutions from dealing with virtual currency or cryptocurrency holders and exchanges.
Violation of Article 19(1)(g): The Supreme court held that the ban did not pass the “proportionality” test. The test of proportionality of any action by the government, the court held, must pass the test of Article 19(1)(g), which states that all citizens of the country will have the right to practise any profession, or carry on any occupation or trade and business.
Causes of Ban: In a circular in 2018, the Reserve Bank of India had banned banks from dealing with virtual currency exchanges and individual holders on the grounds that these currencies had no underlying fiat and that it was necessary in the larger public interest to stop banks from providing any services related to these.
South Korea Passes Law: The South Korean National Assembly on March 4, 2020 passed new legislation that will provide a framework for the regulation and legalization of cryptocurrencies and crypto exchanges. The law would authorize Korea’s financial regulators to effectively oversee the nascent industry and develop rules around anti-money laundering among other processes.
Cryptocurrency: It is digital money and is transferred over the internet through blockchain technology. It is protected by complex codes and does not have a centralised regulator like the RBI or the Federal Reserve Bank. Bitcoins is one of the cryptocurrencies. Coinbase, Zebpay, Unocoin, Coinmama Kraken are popular exchanges to trade in bitcoin too.
