The Supreme Court on Monday questioned the Centre’s delay in establishing a definitive policy for cryptocurrency regulation, expressing concerns over its economic implications. The bench, comprising Justices Surya Kant and N Kotiswar Singh, drew parallels between Bitcoin transactions and illegal “hawala” operations. Justice Kant observed, “Trading in Bitcoin is an illicit trade more or less like a Hawala business.”“Why does Centre not come out with a clear cut policy on regulating cryptocurrency? There is a parallel under-market for it and it can affect the economy. By regulating the cryptocurrency, you can keep an eye on the trade,” the bench addressed Additional Solicitor General Aishwarya Bhati, representing the Centre, quoted by news agency PTI.Bhati sought time to obtain instructions regarding the matter.The court was considering a bail application for a person detained in Gujarat for unauthorised Bitcoin trading, expressing uncertainty about whether the individual was a victim or perpetrator.According to Bhati, the accused operated as a significant Bitcoin trade facilitator in the state, exploiting others through promises of substantial returns and engaging in abduction.On May 5, the court had expressed frustration over the Centre’s failure to establish clear cryptocurrency regulations, comparing Bitcoin trading in India to “dealing with a refined way of Hawala business.”Shailesh Babulal Bhatt, arrested for alleged unlawful Bitcoin trading, petitioned the court for bail. The matter involved the dismissal of several FIRs against Bhatt, who allegedly deceived investors nationwide by encouraging Bitcoin trading with promises of high returns.His legal representative argued that Bitcoin trading became legal in India after the Supreme Court nullified a Reserve Bank of India circular in 2020, rendering his client’s arrest unlawful.On February 25, 2022, the court requested the Centre to clarify its position regarding the legality of cryptocurrency trading, including Bitcoin, in India.
