In a move that might prove highly disruptive for the Indian cryptocurrency scene, the Reserve Bank of India (RBI) has banned banks and other e-wallets from providing services to businesses and individuals dealing with cryptocurrencies.
All major financial institutions in India have to follow RBI’s guidelines and will now have to completely stop all transactions related to cryptocurrencies.
Although the RBI had been cautioning crypto investors against the risks involved in cryptocurrency trade, and several banks had already stopped crypto transactions pre-emptively, the ban will potentially stop all such transactions in the country.
In his budget speech, Finance Minister Arun Jaitley had said that the Indian government does not have any plans to recognise cryptocurrencies as legal tender and the RBI too has released several press releases warning banks and individuals of the risks involved with cryptocurrencies.
The ban will be effective immediately with institutions providing facilities for crypto trading to exit within a specified period of time.
The ban in effect means that people won’t be able to deposit or withdraw their money in crypto wallets thereby halting the growing crypto trade in the country.
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