The clarification from the central bank will come as a sign of relief for all investors and crypto exchanges in India who invested in virtual currencies. The latest directive comes against the backdrop of some banks and regulated entities citing the circular and cautioning customers against dealing in virtual currencies. The circular, issued on Monday, is addressed to all commercial and co-operative banks, payments banks, small finance banks, NBFCs and payment system providers. Earlier, HDFC Bank and State Bank of India (SBI) have cautioned their customers against dealing in virtual currencies such as bitcoin, according to emails sent by the lenders. Private digital currencies/ virtual currencies/ crypto currencies have gained popularity in recent years.

Source: Mint May 31, 2021 14:15 UTC