The Supreme Court of India has expressed concern about non-regulated Bitcoin trade, in which compared to a refined form of Hawala during a recent hearing in a crypto-related matter.
According to Local mediaThe observation then questioned the court the absence of a clearly regulatory framework for virtual currency in the country. The bank, consisting of judges Surya Kant and N Kotiswar Singh, said that the lack of formal rules concerning crypto assets had created uncertainty, which led to potential abuse.
The comments were made while hearing the bail of Shailesh Babulal Bhatt, which has been in custody since August 2023 due to alleged illegal Bitcoin trade.
During the hearing, the lawyer of Bhatt, senior lawyer Mukul Rohatgi, argued that Bitcoin trade is not illegal in India, especially after the statement of the Apex Court, who brought down the ban on Banking Services for Crypto platforms in 2020.
Justice Surya Kant replied that his understanding of Bitcoin is limited, but emphasized that, without regulation, Bitcoin trade seems strong in “a refined way of Hawala.”
For those who are not aware, Hawala is an informal, often illegal, money transfer system that works outside of traditional bank channels.
The bank further noted that this was not the first time that the issue had come to court. Two years ago in particular, the court had specifically asked the center to clarify its policy on virtual currency.
The case in question dates from February 2022, when the Supreme Court was Hear a petition To destroy several FIRs that have been submitted against a person accused of duping investors via a Bitcoin schedule.
Kant said, however, that no progress had been made since then. The absence of each update, despite repeated calls for clarity, has left the judiciary in a difficult position when dealing with such things, he implied.
Despite the constant uncertainty, India has taken a few steps in the direction of supervision of virtual digital assets. A tax regime introduced in 2022 imposes a 30% tax for crypto profit and a tax of 1% deducted from the source on all transactions above a certain threshold.
In addition to taxation, virtual assets transactions were brought under the prevention of money laundering in March 2023. Many platforms, including Binance, Kucin and Coinbase, have since registered with the financial commitment unit of India to comply with the local rules.
However, a wider regulatory framework remains absent. In a response from December 2024 to parliament, the government said that there is currently “no fixed timeline” for introducing extensive rules for virtual assets.
As treated earlier on crypto.news, Ajay Seth, secretary of the Department of Economic Affairs, addressed the delay in releasing a cryptocurrency document, originally planned for September 2024, during a recent round table with policy.
With large economies such as the US who look at their position on Crypto again, after policy shifts under President Trump, Seth said that India would also have to assess his approach.
“We had finished a discussion document, but we now have to calibrate it again because of these changes,” Seth said at the time.
