Indian cryptocurrency exchanges considering challenging RBI's diktat

Q16. It is a blockchain-based cryptocurrency that works in a similar way to Ethereum and bitcoin. It is a peer-to-peer internet currency that allows for instant, near-zero cost payments to anyone in the world. It’s a decentralised payment network that isn’t managed by any central authorities. What is it known as?

Indian cryptocurrency exchanges are considering to challenge the diktat of the RBI which prohibits entities under its regulation to work with companies which offer cryptocurrency services.

Startups like Unocoin, Coinsecure and Zebpay have expressed their reservations with the order and going by the statements they are considering to mount a legal challenge in the Supreme Court.

Coinsecure said that they were discussing the matter with industry stakeholders like Blockchain and Cryptocurrency Committee of India and the Internet and Mobile Association of India.

"We, along with the other industry players are in talks with IAMAI and BACC to see if they could help us in getting a hearing at the Supreme Court to see if stay orders are possible on the current decision of the RBI," Coinsecure chief operating officer Jincy Samuel told CoinDesk.

Samuel, though, acknowledged that the central bank’s order will affect their services and investors will be left with options to move to an alt to alt trading or the cash market.

Also Read: After RBI's salvo, what happens to your bitcoins now?

However, Zebpay CEO Ajeet Khurana said that no way this order is going to stop them. “We will continue to do what is best for our customers, and what is best for our country. Am studying the present situation and will react shortly. and we will emerge stronger (Sic),” he tweeted.

Though the company accepted that "a sudden disruption in banking services could affect our ability to service deposits and withdrawals."

Also Read: Cryptocurrency startups' reactions on RBI order 

The RBI in its order on Thursday said, “In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling Virtual Currencies. Regulated entities which already provide such services shall exit the relationship within a specified time.” The central bank later clarified that the specified time is three months.

“As on today, no banks (that we are working with) have issued any notice to us and when they do and if it has an impact on you and /or us, we will surely communicate to you,” Unocoin said in a statement.