An Indian based startup that intends on launching its own cryptocurrency trading platform has filed a lawsuit against the governing bank of India RBI (Reserve Bank of India), due to its restriction imposed on all commercial banks with regards to any sort of crypto-related services.
The company Kali Digital Ecosystems allegedly registered a case in the Delhi High Court on this past Tuesday(17th April) against RBI, also referred to as the Finance Ministry of the nation and regulatory body for Goods and Services Tax (GST) probing “an applicable order or direction revising the circular’ which makes it ‘arbitrary and unlawful’. The start-up had decided to introduce its very own cryptocurrency exchange ‘CoinRecoil’ by August 2018, and revealed in the appeal that it has “begun collecting investments in this matter.” However, due to the new limitations levied upon banking services by the regulator (RBI), the start-up, unfortunately, would not be able to carry out operations anymore.
The filed lawsuit reads:
“Taking into account the Impugned Circular, the claimant will be unable to make use of the banking services to run the exchange ‘CoinRecoil’. These banking services are a must for such businesses.”
The actions taken by RBI disrupts the constitutional rights to peruse any profession or establish a trading business. It also claims that the regulator does injustice to crypto-related businesses and treats them differently without and explanation.
This lack of explanation that the firm insists for, is due to the inadequacy of RBI to determine the term ‘cryptocurrency’. which is fiercely misunderstood and considered as reward schemes just like airline miles.
Similarly, the company said that the GST Council has failed to introduce and impose cryptocurrency tax policies, which has majorly affected the crypto industry in India, the company further added.
Hence, it finally put forth a petition to rectify and take appropriate measures on cryptocurrency regulations.
RBI publicly announced two warnings on cryptocurrencies in 2013 and 2017 respectively. Although, regardless of its stern stand on cryptocurrencies, the bank has plans to launch its own digital currency.