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India's Supreme Court Pushes Government for Clear Crypto Regulations
India’s Supreme Court has questioned the central government over its ongoing delay in setting clear crypto regulations. During a hearing on May 20, Justices Surya Kant and N Kotiswar Singh raised concerns about the lack of a legal framework. They also warned about the risks of an unregulated crypto market.
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India’s Supreme Court Presses Government on Crypto Regulations
“Why hasn’t the Centre introduced a clear policy for cryptocurrency regulation?” the judges asked. They added, “Proper oversight would help track and manage crypto-related activities.”
The remarks came during a bail hearing for Shailesh Babulal Bhatt, a Gujarat resident accused of operating crypto scams. According to Additional Solicitor General Aishwarya Bhati, Bhatt is believed to have been a major whale who has reportedly attracted investors with promises of high returns.
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Court Cautions on Financial Risks
Justice Surya Kant compared the lack of crypto regulations in trading to “hawala” systems to informal financial networks that avoid official banking channels. He warned that a shadow crypto market could cause serious harm to the economy if left unmonitored.
While Bhatt’s exact role as a scammer or victim is still being debated, the justices criticized the ongoing regulatory uncertainty. They stressed that clear rules would help prevent such cases and better protect everyday investors.
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Government Delays on Crypto Regulation Continue
The central government had earlier said it would publish a crypto policy paper by September 2024. However, there has been no progress since. A senior official said they are waiting to see how the U.S. handles crypto under the pro-industry approach of former President Trump before moving forward.
Even with the rising adoption of digital assets across India, the country still operates without firm crypto regulations. With the Supreme Court now applying pressure, the government may soon be forced to break its silence and act.
It’s noteworthy that the Supreme Court’s insistence on clear crypto regulations follows India’s missile attack on Pakistan, which was in retaliation for Pakistan’s terrorist attack.
India’s Stance on Crypto Risks Amid Stability Concerns
India has always imposed stringent regulations and scrutiny over the use of digital currencies. Three senior officials have voiced concerns over the potential threats cryptocurrencies may pose to macroeconomic stability. They have also warned that these risks could affect both developing and advanced economies.
The officials emphasized that private cryptocurrencies, unlike central bank digital currencies (CBDCs), come with significant risks and should not be treated as equals in regulatory frameworks.
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