The Indian Supreme Court has asked the government to respond to calls to regulate bitcoin.
Three justices issued a notice to the central bank, the market regulator, the tax department, and several other agencies, asking them to answer a petition on the matter, the Hindu, an Indian newspaper, reported Tuesday.
The original petition to the court expressed concern that bitcoin can be used to conduct transactions across borders without a trace, making it an attractive tool for ransomware attackers and tax cheats.
According to the petition:
“The lack of any concrete [control] mechanism pending the regulatory framework in said regard has left a lot of vacuum and which has resulted in total unaccountability and unregulated Bitcoin (crypto money) trading and transactions.”
The petition goes on to state that bitcoin exchanges in India add 2,500 users per day, and that some 500,000 residents now hold bitcoin. As of 3:00 p.m. Eastern on Wednesday, the exchange rate between Indian rupees and bitcoin was more than 470,000.
As a result of its adoption, bitcoin usage may affect “the market value of other commodities,” according to the petition, which pleaded with the court for an “urgent direction” for the government to intervene.
The petition noted that some countries are beginning to either regulate or ban bitcoin, citing China’s crackdown on exchanges and Russia’s attempts to block bitcoin websites.
India has typically adopted a “wait-and-see” stance on cryptocurrencies, discussing their role in the world’s largest democracy but not taking concrete steps to regulate or prohibit them.
In April, the government formed a committee to study cryptocurrencies and propose new regulations.