Despite Central Bank’s Prohibition, Banks and People in India Will Use Cryptocurrencies
India is the second populous country in the world, and with this population, it is able to change the face of every industry; however, this populated country has chosen to get distance from cryptocurrencies and neglect the latest innovations. The central bank in this country has warned its citizens of investment in cryptocurrencies at least since 2013. Then in 2017, after the second warning, this bank issued a directive wherein all the banks of India are forbidden from any cryptocurrency trade. In spite of policies adopted by the central bank of India, there are many banks who ignore this warning, and even the people of India have protested to object against these policies.
Cooperation of Federal Bank of India with Ripple
On Thursday, March 28, federal bank, a big private commercial bank in India, announced that it intended to cooperate with Ripple in order to have access to faster and more secure trades.
Shyam Srinivasan CEO of federal bank and John Mitchell senior vice president at Ripple confirmed this news. According to the agreement that the federal bank of India and Ripple have signed, this bank can employ a new cryptocurrency payment system. Cooperation with Ripple is a part of a broad plan of applying new technologies transferred to the banking network. Moreover, this cooperation causes the increase of the share of the federal bank of India. Indian bank isn’t satisfied with this achievement and has launched two operating systems for making payment to India on March 28 in the United Arab Emirates.
A Look at Federal Bank Case of India
Federal bank is a pioneer among other conventional banks of India in using and employing its new banking technology. This bank is one of the first Indian banks which has digitalized all its subsections and financial branches. While the government of India doesn’t have any inclination to the industry of cryptocurrencies, this bank has optimistically entered Blockchain and cryptocurrencies technology. Federal Bank of India has a 70-year-old history, 1251 branches, more than 1655 ATMs and 258 cash recyclers.
Ambiguity in the Cooperation of the Bank of India and Ripple
Unfortunately, it has not been specified in this agreement whether the federal bank of India intends to use cryptocurrencies besides cooperating with Ripple company. Signing up this agreement can be very surprising considering disturbed bygone of cryptocurrencies in India.
Last year the central bank of India published a directive based on its lack of support of cryptocurrency-based trades. This measure was later investigated in the court of appeals, but the supreme court of India supported the central bank’s measure by rejecting it. Also, in adherence to the central bank’s judgment, a bank in India named Kotak forces it customers to plight that they will not do any trade based on cryptocurrency especially with Bitcoin when opening an account.
A One-sided Judgment by the Central Bank of India
It might seem that the central bank of India has adopted such policy against cryptocurrencies after much research, but in fact, it is not the case. Following the prohibitions on the part of Indian banks of cryptocurrencies trades, Varun Sethi, Indian central bank lawyer, in response to the right to information (RIT), has confessed that before this decision, the bank has neither conducted any research nor consulted financial affairs experts.
According to judicial codes of India, each citizen is entitled to request some information from the government in some cases. If a person requests giving information from any governmental authority, it will be on that authority to answer in the passage of 30 days.
Street Protests of Cryptocurrencies Supporters
March 30th, the fourth largest protest of cryptocurrency supporters took place in India. In the previous protest in this month, thousands of Blockchain enthusiasts and big cryptocurrency stockholders came to Delhi, Mumbai and Hyderabad streets.
Following limitations of the central bank of India to trade cryptocurrencies, the last court to investigate this situation is to be held. Indian people have rushed into streets before this court. Although the population of protesters in these three cities had different opinions, it didn’t avoid their participation in the protests. Among them, Hyderabad population had a neutral view and believed that both positive and negative aspects of cryptocurrencies should be taken into account.
Considering all proponents and opponents, the population of India is sure that the collective use of cryptocurrencies is an issue which will occur sooner or later. However, the question is that: will legislators of India support it? Will India take the opportunity of technologic life from its people?