India’s Supreme Court has expressed serious concerns about the absence of a clear regulatory framework for cryptocurrencies, highlighting the risks posed by unregulated Bitcoin trading.
During a recent bail hearing for Shailesh Babulal Bhatt, accused of illegal Bitcoin trading, the bench—comprising Justices Surya Kant and N Kotiswar Singh—questioned why the government has yet to implement comprehensive crypto regulations despite repeated calls from the judiciary.
The court compared unregulated Bitcoin transactions to a sophisticated form of Hawala, an informal and often illegal money transfer system that bypasses official banking channels. Justice Surya Kant acknowledged his limited technical knowledge of Bitcoin but emphasized that without proper oversight, crypto trading could facilitate unlawful activities similar to those associated with Hawala.
Bhatt’s defence, led by senior advocate Mukul Rohatgi, cited the Supreme Court’s 2020 ruling that struck down the Reserve Bank of India’s banking ban on cryptocurrency platforms, arguing that Bitcoin trading is not inherently illegal in India. However, the court pointed out that the lack of regulatory clarity has created legal ambiguities, complicating the handling of crypto-related cases.
The judiciary also noted the government’s slow progress in formulating a crypto policy. This issue was first raised two years ago, yet no significant regulatory developments have occurred, leaving the crypto sector in a legal grey area.
In a related development, the Karnataka High Court recently ordered the blocking of Proton Mail’s domain names under India’s Information Technology Act of 2008. This move reflects the increasing tension between privacy-focused technologies and government surveillance efforts in India.
The Supreme Court’s remarks underscore the urgent need for India’s government to establish clear, effective regulations for cryptocurrencies to prevent misuse and foster a safer environment for digital asset trading.
Meanwhile, Polygon is partnering with Reliance Jio to incorporate blockchain into their web services, intending to solve real-world problems for over 450 million users. This collaboration seeks to balance speed, scalability, and affordability while maintaining decentralization.
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