Decrypting Crypto-Currency: A Case Study in The Light of Supreme Court Decision In Internet And Mobile Association of India Vs. RBI

Abstract

An innovative technological development has revolutionized the advent of money. The amalgamation of digital cash with block-chain technology has resulted in the concept of crypto-currency. The history of money has witnessed a unique rise. From the times where exchange of goods, piece of paper, animal skins or rendering of services would amount to trade commonly known as the barter system, one saw the light of coinage where coins of copper, silver and gold were utilized for daily transactions. Gradually, coins and notes in the form of physical paper made their way for national and international trade. Remarkably, the economy is introduced to two-fold mechanisms that are, e-payments as well as virtual currency. The Reserve Bank of India, in accordance with its mandate, barred banks and financial entities regulated by it from giving banking services to those associated with crypto-asset transactions, citing regulatory, legal, and operational risks, as well as worries about protection required for consumers, integrity of the market to be kept intact and money laundering, among other things. On 4^th March, 2020, the Supreme Court vide its judgment lifted the ban imposed by RBI on trade of virtual currencies on the ground of proportionality, citizens’ right to create a new industry of crypto-currencies which is the fundamental right to trade. The present research aims to analyze the judgment passed by Indian apex court along with the concept of crypto-currencies, the arbitrary ban by RBI, lifting of ban by the SC, validation of legal tender of crypto-currency, constitutional provisions, allied enactments, the court’s take on self-regulatory mechanism and perspectives of other countries.

Purpose of research: The purpose of this research work is to study the crypto currency under the umbrella of the judicial decision. It also analyses how the stakeholders were affected by the prohibition imposed by the RBI circular and the grounds of the annulment of the ban. This paper tracks and studies the observations and obiter dicta of the Supreme Court of India.

Object of research

1. To understand the evolution of crypto currency


2. To study the trajectory of the precautionary measure of RBI


3. To analyze the verdict of the Supreme Court of India