Delhi High Court Seeks Government's Response on Cryptocurrency Regulation Amid Investor Complaints The case stems from complaints by numerous investors who claim they were unable to withdraw their funds from Bitbns, with reported losses ranging from INR 20,000 to INR 1.5 crore
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The Delhi High Court has directed the Ministry of Finance (MoF), the Reserve Bank of India (RBI), and the Securities and Exchange Board of India (SEBI) to respond to a petition filed by investors affected by the alleged misconduct of Bitbns, a cryptocurrency exchange in India. The petition raises concerns about the lack of regulations governing cryptocurrencies in the country.
The case stems from complaints by numerous investors who claim they were unable to withdraw their funds from Bitbns, with reported losses ranging from INR 20,000 to INR 1.5 crore. According to complaints filed on the National Cybercrime Portal, the issues began in mid-2024 and have since escalated, leaving many investors without answers. An investigation by Delhi Police revealed that Bitbns' founders are untraceable and may have fled the country.
During a hearing on January 9, 2025, Justice Sachin Datta issued notices to the MoF, RBI, and SEBI, seeking their replies within four weeks. The petitioners, represented by Advocate Dinesh Jotwani, argued that the absence of regulations has left investors vulnerable to fraudulent activities by unregulated cryptocurrency platforms.
In response to a query from the court, Jotwani highlighted that while the Finance Act 2022 introduced taxes on Virtual Digital Assets (VDAs), no comprehensive framework for cryptocurrency regulation currently exists in India.
The court's decision to seek input from the country's key financial regulatory bodies could pave the way for the formulation of policies to address the growing risks in the cryptocurrency sector.
