{"id":549295,"date":"2026-07-22T11:52:06","date_gmt":"2026-07-22T10:52:06","guid":{"rendered":"https:\/\/cryptoslate.com\/?post_type=crypto_law&p=549295"},"modified":"2026-07-22T11:54:31","modified_gmt":"2026-07-22T10:54:31","slug":"internet-mobile-association-india-v-reserve-bank-india","status":"publish","type":"crypto_law","link":"https:\/\/cryptoslate.com\/crypto-laws\/internet-mobile-association-india-v-reserve-bank-india\/","title":{"rendered":"Internet and Mobile Association of India v. Reserve Bank of India"},"content":{"rendered":"

Internet and Mobile Association of India v. Reserve Bank of India<\/strong> is a 2020 Supreme Court of India decision concerning RBI\u2019s April 2018 virtual-currency banking circular. The case arose from Writ Petition (Civil) No. 528 of 2018, brought by the Internet and Mobile Association of India, together with Writ Petition (Civil) No. 373 of 2018 involving crypto exchange operators, shareholders, founders and traders. The judgment is best profiled as an Indian court ruling that remains relevant to banking access for crypto-asset activity.<\/p>\n

The ruling did not create a comprehensive crypto statute, licensing regime or legal-tender status for virtual currencies. It instead addressed whether RBI could, on the record before the Court, use its statutory powers to cut off RBI-regulated entities from dealing with or servicing virtual-currency activity. The Court held that RBI had jurisdiction to address risks touching the currency, credit, payment and financial systems, but concluded that the April 6, 2018 circular failed proportionality review.<\/p>\n

Background: the 2018 RBI virtual currency circular<\/h3>\n

RBI\u2019s April 5, 2018 policy statement addressed \u201cring-fencing regulated entities from virtual currencies.\u201d It acknowledged that technologies underlying virtual currencies could improve financial-system efficiency and inclusion, while also citing concerns involving consumer protection, market integrity and money laundering. The following day, RBI issued DBR.No.BP.BC.104\/08.13.102\/2017-18 to commercial banks, cooperative banks, payment banks, small finance banks, NBFCs and payment-system providers.<\/p>\n

The circular directed RBI-regulated entities not to deal in virtual currencies or provide services facilitating any person or entity dealing with or settling virtual currencies. RBI listed examples including maintaining accounts, registering, trading, settling, clearing, lending against virtual tokens, accepting them as collateral, opening accounts of virtual-currency exchanges and processing money transfers linked to purchases or sales of virtual currencies. Existing relationships had to be exited within three months.<\/p>\n

What the Supreme Court decided<\/h3>\n

Justice V. Ramasubramanian delivered the judgment for a three-judge bench. The Court rejected the petitioners\u2019 broad argument that RBI lacked statutory power over virtual currencies. It reasoned that users and traders of virtual currencies carry on activity within RBI\u2019s purview because virtual currencies may affect monetary, payment, credit and financial systems, even if they are not legal tender.<\/p>\n

The Court then separated the existence of regulatory power from the proportionality of the measure chosen. It noted that RBI had wide preventive and curative powers, but said RBI needed at least some evidence of damage suffered by its regulated entities when a measure disconnected exchanges from banking channels. On that record, and given RBI\u2019s own position that it had not banned virtual currencies, the Court held the circular disproportionate.<\/p>\n

Status and legal effect<\/h3>\n

The Supreme Court allowed the writ petitions and set aside the April 6, 2018 circular on March 4, 2020. The April 5, 2018 policy statement was not set aside because the Court treated it as non-statutory. For this profile, the court ruling should be marked \u201cIn force,\u201d while the targeted RBI circular should be described as struck down.<\/p>\n

RBI later confirmed this effect in a May 31, 2021 notification on customer due diligence for virtual-currency transactions. RBI said bank references to the 2018 circular were not in order because the circular had been set aside by the Supreme Court and was no longer valid from the date of judgment. RBI also stated that banks and covered entities may continue KYC, AML\/CFT, PMLA and FEMA-related checks under separate legal requirements.<\/p>\n

Scope and limitations for India crypto regulation<\/h3>\n
    \n
  • The judgment restores the invalidation of RBI\u2019s 2018 banking-service restriction, but it does not amount to a comprehensive virtual-asset framework.<\/li>\n
  • The ruling recognizes RBI\u2019s power to regulate risks that may affect India\u2019s financial and payment systems.<\/li>\n
  • It leaves separate AML\/CFT, customer due diligence, foreign-exchange, tax and future legislative measures to be assessed on their own terms.<\/li>\n
  • The case is most relevant to banking access, regulatory perimeter and proportionality review of crypto-related restrictions.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"

    India\u2019s Supreme Court set aside RBI\u2019s 2018 virtual-currency banking circular on proportionality grounds while recognizing RBI\u2019s power to regulate crypto-related financial risks.<\/p>\n","protected":false},"author":1652,"featured_media":549462,"template":"","meta":[],"crypto_law_jurisdiction":[81436],"crypto_law_topic":[81505,81864,81519,81870],"crypto_law_status":[81585],"crypto_law_type":[82161],"crypto_law_actor":[83254,83253,83252],"crypto_law_asset_class":[81571,82033],"acf":[],"yoast_head":"\nIAMAI v. 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