Module Overview
This module provides an in-depth examination of the Reserve Bank of India's regulatory approach to cryptocurrencies and digital assets. From the landmark RBI Circular of April 6, 2018 (DBR.No.BP.BC.104/08.13.102/2017-18) to the Supreme Court's decision in IAMAI v. RBI (2020) 10 SCC 274, we trace the evolution of banking regulations affecting crypto businesses.
Students will gain practical knowledge of the Payment and Settlement Systems Act, 2007, Foreign Exchange Management Act, 1999, Prevention of Money Laundering Act, 2002, and the emerging framework around Central Bank Digital Currency (CBDC) - the Digital Rupee.
RBI Regulatory Framework
Understanding PSS Act 2007, RBI Act, and regulatory powers
Banking Relationships
Navigating de-risking challenges and account access
FEMA Compliance
Cross-border transactions and LRS implications
Digital Rupee (CBDC)
RBI's e-Rupee pilot and legal framework
Key Regulatory References
RBI Circular (April 6, 2018)
DBR.No.BP.BC.104/08.13.102/2017-18 - Prohibition on dealing in VCs
Payment and Settlement Systems Act, 2007
Regulatory framework for payment systems
Foreign Exchange Management Act, 1999
Cross-border transaction regulations
IAMAI v. RBI (2020) 10 SCC 274
Supreme Court judgment on RBI circular validity
Prevention of Money Laundering Act, 2002
AML/KYC compliance requirements
RBI Master Direction on KYC
Customer due diligence norms for crypto platforms
Liberalized Remittance Scheme (LRS)
$250,000 annual limit for outward remittances
RBI e-Rupee Pilot (December 2022)
CBDC pilot program launch
Module Parts
RBI's Regulatory Powers over Payment Systems
Comprehensive analysis of the Payment and Settlement Systems Act, 2007, RBI Act provisions, and the central bank's authority over digital payment mechanisms.
History of RBI's Approach to Cryptocurrency
Chronological examination from 2013 press releases through the 2018 circular to post-IAMAI developments, tracing regulatory evolution.
Banking Relationships for Crypto Businesses
Practical guidance on account opening challenges, de-risking by banks, and strategies for maintaining banking access.
FEMA Implications for Crypto Transactions
Analysis of current vs capital account transactions, cross-border payments, and the Liberalized Remittance Scheme application to crypto.
Central Bank Digital Currency (CBDC) - Digital Rupee
Study of RBI's e-Rupee pilot program, legal framework, technical architecture, and comparison with private cryptocurrencies.
KYC/AML Requirements for Crypto Platforms
Detailed examination of PMLA 2002 compliance, RBI KYC Master Direction, and FATF recommendations for virtual asset service providers.
Stablecoins and Payment Regulations
Legal classification of stablecoins, payment system implications under PSS Act, and regulatory treatment in India.
Future of Crypto Banking in India
Analysis of regulatory sandbox approaches, international models, and policy recommendations for the Indian crypto-banking ecosystem.
Module 2 Assessment
Test your knowledge of RBI regulations, banking laws, and cryptocurrency compliance requirements.