The Reserve Bank of India (RBI) announced on April 5, 2018 in a press release that it banned banks and regulated financial institutions from trading digital currencies.
This means that banks will no longer be able to transfer money to a wallet or cryptographic exchange. Regulated companies that already offer such services have three months to reduce their cryptocurrency operations.
At the same time India has not abandoned the idea of having its own virtual currency. While many central banks are still involved in the debate the Reserve Bank has established an inter ministerial group to study the feasibility and viability of introducing a digital currency to the central bank.
The RBI was very critical of cryptocurrencies including bitcoin in the past. On three occasions. the central bank has warned owners and traders of the risks of virtual currencies.
India a fiduciary country began tightening cryptocurrency in 2018 to prevent money laundering, terrorist financing and tax evasion. In January 2018, Indian Finance Minister told the Indian Parliament Bitcoins or these cryptocurrencies are not legal tender and those that allow such transactions do so at their own risk.
