The Reserve Bank of India (RBI) told banks not to rely on previous notices. The notice stated that banks should not cooperate with crypto exchanges.

Indian crypto industry executives said that the latest notice is unlikely to convince major banks to cooperate with them.

The Central Bank of India asked banks not to cite its 2018 notice of prohibiting banks from providing services to crypto companies, and reminded banks that the Supreme Court of India had lifted this prohibition last year.

In the April 2018 notice, the Reserve Bank of India stated that the bank cannot provide related services to “any individual or business entity that handles or settles virtual currencies”.

In March last year, the Supreme Court of India ruled that the notice of the Central Bank of India was meaningless and that banks could conduct transactions with crypto companies if they wish. Despite this ruling, major Indian banks continue to ban crypto transactions. According to U.Today reports, in the past few weeks, banks such as HDFC Bank and SBI Card cited the 2018 notice from the Bank of India to formally warn their customers not to conduct cryptocurrency transactions.

The Indian crypto exchange chose to continue to challenge the Reserve Bank of India. Last Friday (May 28), several exchanges threatened to sue the Bank of India to the Supreme Court, because earlier this month a source said that the Bank of India informally asked banks to cut ties with crypto businesses.

Finally, the Central Bank of India satisfied the needs of Indian crypto exchanges.

In its notice on Monday (May 31), the Central Bank of India stated that “in view of the Supreme Court’s order, the notice is no longer valid from the date of the Supreme Court’s decision and therefore cannot be cited.” At the same time, it also allows banking institutions to deal with digital assets. Of customers conduct due diligence.

Sidharth Sogani, CEO of CREBACO, an Indian cryptographic intelligence company, told Decrypt that Monday’s notice fulfilled a long overdue procedure. He said the Bank of India is trying to “avoid legal difficulties caused by the threat of litigation.”

Although the Indian Central Bank’s notice stated that banks can provide services to any customer that meets the standards, it does not encourage banks to cooperate with crypto companies, and there is no indication that Monday’s notice will bring about any changes.

Zakhil Suresh, founder of the crypto trading simulator SuperStox, said, “Managers of several banks told me that they do not allow crypto trading based on internal compliance policies, not because of the Reserve Bank of India.”

Suresh said that banking policies have hurt the industry. “Even the bank accounts of employees are frozen, simply because they receive wages from a crypto exchange.”

Sogani predicts that small banks may now allow services for crypto customers — better than nothing. He said, but small banks usually don’t provide the complex APIs required by crypto exchanges.

However, if no major banks are willing to cooperate with crypto companies, crypto exchanges will continue to be in a quagmire.

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