India's Supreme Court Slams Unregulated Bitcoin Trading: "It's Just Fancy Hawala!"

Court Calls Out Regulatory Void Amidst Crypto Chaos

Holy smokes! India's Supreme Court just dropped a bombshell, comparing Bitcoin trading to a slick version of Hawala during a wild bail hearing in a crypto case. The judges are not messing around, pointing out the total absence of rules for virtual currencies in the country. Justices Surya Kant and N Kotiswar Singh are up in arms about the chaos and potential misuse this lack of regulation is causing.

Bail Plea Drama: Bitcoin Trader in Hot Water

This fiery exchange went down while they were hearing the bail plea of Shailesh Babulal Bhatt, who's been locked up since August 2023 for allegedly pulling off some shady Bitcoin trading. Bhatt's lawyer, the big-shot Mukul Rohatgi, tried to argue that Bitcoin trading isn't illegal in India, especially after that massive 2020 ruling that knocked down the Reserve Bank of India's ban on banking services for crypto platforms.

Justice Kant's Blunt Take: Bitcoin = Fancy Hawala

But Justice Surya Kant wasn't buying it. He straight-up admitted his Bitcoin knowledge is limited, but he didn't hold back, saying that without any rules, Bitcoin trading is basically "a refined way of Hawala." For the uninitiated, Hawala is that sketchy, often illegal money transfer system that flies under the radar of traditional banks.

Court's Frustration: "We've Been Asking for Clarity for Ages!"

The bench was fuming, pointing out that this isn't the first time they've been thrown into this mess. Back in February 2022, during another Bitcoin-related case, they had to beg the Centre to get its act together and clarify its policy on virtual currencies. But guess what? Nada. Justice Kant was visibly frustrated, saying there's been zero progress since then, leaving the judiciary hanging out to dry when dealing with these cases.

India's Half-Measures: Taxes and Money Laundering Laws

Despite the ongoing wild west situation, India's taken some baby steps towards regulating virtual digital assets. They slapped a 30% tax on crypto profits and a 1% tax deducted at source on transactions above a certain threshold back in 2022. And in March 2023, they brought virtual asset transactions under the Prevention of Money Laundering Act. Big names like Binance, KuCoin, and Coinbase have jumped through hoops to register with India's Financial Intelligence Unit to play by these new rules.

The Big Question: When Will India Get Its Act Together?

But let's be real, a full-blown regulatory framework is still MIA. The government dropped a bombshell in Parliament in December 2024, saying there's "no fixed timeline" for rolling out comprehensive rules on virtual assets. Ajay Seth, the big cheese at the Department of Economic Affairs, spilled the tea at a recent policy roundtable about the delay in releasing a cryptocurrency discussion paper, which was supposed to drop in September 2024.

Global Shifts: India's Forced to Reassess

With heavyweights like the U.S. flipping the script on crypto under President Trump, Seth said India's got no choice but to rethink its own game plan. "We were ready with a discussion paper, but we now need to recalibrate it due to these changes," he dropped at the time. Buckle up, folks, because the crypto rollercoaster in India is far from over!