Kali Digital, the company behind CoinRecoil was the first exchange to challenge RBI’s Banking Ban in Delhi High Court. The Supreme Court had then ordered all related cases to RBI’s Banking Ban be transferred to Supreme Court. Kali Digital Withdrew its case from Supreme Court in August 2019, more than a year after fighting it along with IAMAI and other petitioners.
On August 21, 2019, the Supreme Court approved a withdrawal application for Kali Digital Ecosystems Private Limited Vs ORS. With this Kali Digital will not be challenging the RBI’s Banking Ban. But this is not entirely bad news for the crypto community, as other petitioners such as IAMAI and Crypto exchanges are still fighting the case.
Less than three weeks since the Reserve Bank of India put out a notification titled “Prohibition of Dealing in Virtual Currencies” barring all banks and other regulated entities from supporting any businesses or individuals dealing in Crypto, Kali Digital, which was on the verge of launching CoinRecoil Crypto Exchange had Delhi Court send a notice to RBI, the Union of India and the GST council. The next hearing was set to May 24 2018.
Fast forward a few weeks and Kali Digital’s case was transferred to the Supreme Court, merged with all the other petitions related to the matter. But a whole year later in August, the exchange decided to withdraw their petition.
Kunal Barchha, the CEO of CoinRecoil has confirmed that the decision to withdraw the case was made to curb the legal expenses. Barchha wrote an open letter in June to the Prime Minister of India titled “Government Screwed Us”, describing the difficulties faced by the exchange to operate after the RBI diktat and constant negativity from the government.
Many speculations in youtube suggest that Kali Digital may be pivoting to a new business. Barchha brushes off the rumour while speaking to Coin Crunch.
The Fight is On
Despite Kali Digital dropping out of the suite, the Supreme Court has heard the arguments from counsels of IAMAI, other crypto exchanges and the RBI and the next hearing date is set to September 25, 2019.
The Supreme Court has asked RBI to submit a point-by-point response to IAMAI’s representation in two weeks. The response from RBI will be a key differentiator in this case that has dragged along for over a year. The RBI Banking ban has claimed several victims, such as Zebpay, Koinex, Coinome, Coindelta and many more smaller cryptocurrency exchanges.
The Inter Ministerial committee setup by the government of India has submitted its report on Virtual currencies, recommending a complete ban. A draft bill for banning of Cryptocurrencies was submitted to the government in February 2019, but released to public on July 22.
A positive Supreme Court decision on RBI’s banking ban would only lift the RBI’s circular. The Government of India may table the bill in Parliament in the winter session.