View: Why it’s better for RBI to just wait and watch on cryptocurrency

By Ateesh Tankha


Imagine an Indian hotel chain that’s mortally afraid of the coronavirus. No cases have yet been reported at any of its properties, but, lacking sufficient information and medical infrastructure, the chain instructs its properties to cancel all guest bookings in line with what hotels abroad have done. A set of disgruntled guests take the hotel to court, claiming that the chain has taken disproportionate action.

Should the law rule be in favour of the guests because the hotel lacks ‘empirical evidence’ that proves that the properties would have suffered reputational or other damage if the bookings had not been cancelled? A March 4 Supreme Court judgement overturning an earlier 2018 Reserve Bank of India (RBI) ruling on cryptocurrencies seems to suggest as much.

In April 2018, after five years of unregulated trading in cryptocurrencies, RBI issued a ruling to its member banks not to deal in virtual currencies (VCs) or provide services for facilitating any person…