The Reserve bank of India has responded to a query regarding its reasons to ban banks from dealing with the cryptocurrency industry, asserting that it did not conduct any research before taking a prohibitive action on Bitcoins.
Varun Sethi, a domestic lawyer had filed an RTI request asking the reasons behind its April ban that banned all regulated financial institutions from providing services to cryptocurrency businesses.
RBI responded by confirming that it gave little no thought before making the decision and they did not conduct any internal or independent research before enforcing the ban.
RBI’s diktat was appearing to be an arbitrary one as the central bank did not clarify its position and they plainly refused to answer any other probing questions asked in the information request.
The Central bank officials were also asked if the authority established an internal committee for determining if there were any risks in trading cryptocurrencies. They answered in negative.
The Reserve Bank of India also refused to clarify how it had determined public risks in cryptocurrencies from 2013. Likewise, it refrained from disclosing its take on acknowledging self-regulated cryptocurrency exchange that follows KYC norms, if it had sought an external expert opinion before enacting the ban.
The central bank stayed mum on all the questions and pointed out a loophole in the RTI act which gave them an exemption from giving an answer.
Last month, the central bank did not clear their stance against a Supreme Court-approved petition which asked for regulation to effectively legalize and recognize the digital currency industry in the country.
The RBI also abstained from outlining policy or framework for the nascent sector, stating that the Reserve Bank of India cannot decide for the government on the legality of virtual currencies in India.