RBI bars banks from providing any services to crypto currency companies

RBI bars banks from providing any services to crypto currency companies

Mumbai, Apr 5: In a major crackdown on crypto currencies like Bitcoin, the Reserve Bank of India has barred all entities that it regulates from dealing with virtual currency companies.
“Virtual Currencies (VCs), also variously referred to as crypto currencies and crypto assets, raise concerns of consumer protection, market integrity and money laundering, among others,” said RBI in a statement.
“In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs,” the statement added.
What this means is that banks can no longer facilitate purchase of coins or facilitate payment settlements for cryptocurrency exchanges.
The central bank said that it has repeatedly cautioned users, holders and traders of virtual currencies, including Bitcoins, regarding various risks associated in dealing with such virtual currencies.
Regulated entities which already provide such services shall exit the relationship within a specified time.
It may be recalled that banks such as HDFC and Citibank had barred their cardholders from using them to make payments for purchase of crypto currency.