“Why does Centre not come out with a clear cut policy on regulating cryptocurrency?” the Supreme Court asked on Monday, May 19, highlighting that its impact on the economy. A bench of Justices Surya Kant and N Kotiswar Singh termed the Bitcoin trade as an illicit trade more or less like “hawala” business.
“There is a parallel under-market for it and it can affect the economy. By regulating the cryptocurrency, you can keep an eye on the trade,” the bench told Additional Solicitor General Aishwarya Bhati, appearing for the Centre.
Justice Kant added, “Trading in Bitcoin is an illicit trade more or less like a Hawala business.”
Aishwarya Bhati requested to seek instruction on the matter.
The remarks from the Supreme Court came when it was hearing a bail plea of an accused who was held for illegal Bitcoin trade in Gujarat. The accused, Shailesh Babulal Bhatt, had moved top court for bail.
The court said it could not ascertain whether he was a victim or victimiser.
Clearing on that, Additional Solicitor General said the man was one of the biggest aggregators of Bitcoin trade in the state and victimised others by promising high returns and even indulged in kidnapping.
On May 5, the top court said trading in Bitcoin in India was like “dealing with a refined way of Hawala business” as it lamented the Centre’s inability to come up with a clear regime on regulating virtual currency so far.
The accused’s counsel said trading in Bitcoin was not illegal in India after the apex court quashed a circular of the Reserve Bank of India in 2020, making his client’s arrest illegal.
On February 25, 2022, the Supreme Court asked the Centre to clarify its position on whether trading in cryptocurrencies like Bitcoin is legal in India or not.
The case related to the quashing of multiple FIRs against Bhat for allegedly duping investors across India by inducing them to trade in Bitcoin and assuring them of high returns.