RBI provides relief to Bitcoin, Dogecoin investors, asks banks to carry out due diligence

The Reserve Bank of India has given a huge relief to crypto investors and traders by clarifying that banks and other entities cannot use its 2018 order on virtual currencies to caution their customers.

The Reserve Bank of India has given a huge relief to crypto investors and traders by clarifying that banks and other entities cannot use its 2018 order on virtual currencies to caution their customers. This gives investors more clarity on trading in Bitcoin, Dogecoin and other popular cryptocurrencies. The central bank said that its order was set aside by the Supreme Court and cannot be cited by the banks. The clarification comes after reports suggesting that several banks are not allowing access to crypto trading platforms and had warned them against trading in digital currency. "It has come to our attention through media reports that certain banks/ regulated entities have cautioned their customers against dealing in virtual currencies by making a reference to the RBI circular DBR.No.BP.BC.104/08.13.102/2017-18 dated April 06, 2018. Such references to the above circular by banks/ regulated entities are not in order as this circular was set aside by the Hon’ble Supreme Court on March 04, 2020 in the matter of Writ Petition (Civil) No.528 of 2018 (Internet and Mobile Association of India v. Reserve Bank of India),” RBI said in its official statement. It further asked the banks to carry out necessary customer due diligence process in line with regulations governing standards for Know Your Customer (KYC), Anti-Money Laundering (AML), Combating of Financing of Terrorism (CFT) and obligations of regulated entities under Prevention of Money Laundering Act, (PMLA), 2002.