The Supreme Court of India has recently declined to consider a Public Interest Litigation (PIL) that sought to establish a comprehensive regulatory framework for cryptocurrency trading in India. This decision is notable as it highlights the judicial perspective on the legislative nature of cryptocurrency regulations.
Key Details of the Petition and Court’s Ruling
The petitioner, Manu Prashant Wig, currently detained by the Delhi Police, was implicated in a 2020 cryptocurrency case. Wig, accused of defrauding investors in crypto schemes, held a directorial role at Blue Fox Motion Picture Limited. A total of 133 investors, claiming to be victims, filed a case alleging deceit by Wig.
Wig filed the PIL while in custody, ostensibly seeking a regulatory framework for crypto trading in India. However, the Supreme Court, led by Chief Justice D. Y. Chandrachud, determined that the PIL’s true aim was to secure bail for Wig. The court advised Wig to seek legal remedies through appropriate channels and approach a different court for bail matters.
The Supreme Court emphasized its inability to issue directives under Article 32 of the Indian Constitution, pointing out that the demands of the petition were more legislative than judicial. The court’s decision underlines the distinction between legislative and judicial roles in forming regulations, especially in emerging sectors like cryptocurrency.
Crypto Trading in India
Regulatory Uncertainty: The rejection of the PIL underscores the ongoing uncertainty surrounding cryptocurrency trading in India. The absence of standardized rules and specific frameworks for handling cryptocurrencies continues to create a debatable environment.
Future Prospects: India is reportedly in the process of developing a cryptocurrency regulatory framework. This framework is expected to draw on recommendations from the International Monetary Fund (IMF) and the Financial Stability Board (FSB). Legal legislation pertaining to cryptocurrency regulation is anticipated within the next five to six months, which could bring much-needed clarity and structure to the sector.
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