The Supreme Court of India was informed by the Centre on January 20 that it has not yet made a decision on a mechanism to regulate cryptocurrencies and effectively investigate related offenses. Additional Solicitor General Vikramjit Banerjee, appearing for the Centre, informed the bench that the issues related to digital currency are continuously evolving, and the government is deliberating on the mechanism to regulate cryptocurrencies. Banerjee requested time to file an affidavit by the next date of the hearing to provide an updated position on the regulatory mechanism. The bench granted four weeks for filing the affidavit and posted the matter for further hearing on March 21.
Justice Surya Kant emphasized the need for appropriate safeguards to protect the common man from fraud and misuse of cryptocurrencies. The court expressed concerns about the absence of a regulatory mechanism, stating that without regulation, anyone could create a currency and start transacting, posing potential dangers. The ASG assured the court that deliberations are ongoing, and he will file an affidavit detailing the government’s position on the regulatory mechanism at the next hearing.
The Supreme Court was hearing a bail plea from Ganesh Shiv Kumar Sagar, who was booked for cryptocurrency fraud in various states, including Jharkhand, Maharashtra, and Gujarat. Sagar sought the clubbing of various FIRs lodged against him in different states. The interim protection from arrest granted to him on July 27, 2023, was made absolute after the counsel for the Jharkhand government informed the court that Sagar has joined the probe and is fully cooperating with the investigating officer.
In a previous hearing on September 21, 2023, the Attorney General, representing the Centre, had stated that the matter required in-depth consideration at the Union of India level, considering both domestic and international perspectives. He assured that due deliberations would be made within three months, and the court would be apprised of the outcome at the earliest.
The Supreme Court had impleaded the Ministry of Home Affairs in the case on July 27, 2023, and directed Banerjee to file a counter affidavit suggesting a comprehensive mechanism for the effective investigation of offenses related to cryptocurrencies. The court has been closely monitoring the evolving regulatory landscape for cryptocurrencies in India, recognizing the need for clear guidelines and safeguards in this rapidly changing sector.