RBI crypto ban (2018) and Supreme Court ruling

On 6 April 2018, the Reserve Bank of India issued a circular prohibiting banks and other regulated entities from dealing in virtual currencies or providing services to people and businesses dealing in them. Indian exchanges lost access to bank accounts, and many moved to peer-to-peer trading or shut down.

The Internet and Mobile Association of India (IAMAI), representing exchanges, challenged the circular. On 4 March 2020, the Supreme Court set it aside, holding that the RBI's measure was disproportionate given that crypto trading was not illegal and the RBI had not shown actual harm to regulated entities. The judgment restored banking access in principle and triggered a boom in Indian crypto trading.

Since then the RBI has repeatedly expressed concerns about cryptocurrencies, but policy has shifted to taxation and anti-money-laundering rules rather than a ban. In 2021 the RBI advised banks not to cite the quashed circular, though many banks and payment providers remained cautious.