No committee was set up to explore risks behind crytptocurrency technology: RBI

In response to an RTI reply, the Reserve Bank of India has said there was no committee set up to explore the nature and risks of the technology behind the virtual currencies before banning them.

The question, which refers to three public notices dated between 2013 and 2017 that talk about risks associated with virtual currencies, questions if there was any committee convened to asses such risks. RBI replied, “No”.

The RTI application was filed after the central bank passed a diktat banning entities under its regulation to cease dealing in the cryptocurrencies.

The Right to Information application, filed by a lawyer named Varun Sethi, throws several questions but the RBI refused to answer many of them saying that the information sought was not defined as ‘information’ according to the RTI Act.

The RBI also refused to clarify if there was any expert opinion sought on the matter or if the RBI had collected any information on existing cryptocurrency exchanges in India.

In response to State Bank of Sikkim’s status, the RBI just said Banking Regulations Act, 1949 was not applicable to it. The response does not clearly say if the diktat passed by RBI is applicable to SBS.

RBI, though, did provide the name of committees on cryptocurrencies or blockchain technology it was and is part of. This includes the inter-disciplinary committee constituted by Finance Ministry in March 2017 and a committee constituted in November 2017.

The decision by RBI to ban the entities to do business with cryptocurrency companies has been challenged in the Delhi High Court as well.