Today, the March 4th 2020 made sure to have its page not only in the history of Indian crypto industry but that of the entire world.
Unocoin — the first Indian company to provide a trading platform for bitcoin started in December 2013 with the sole intention to provide bitcoin access to Indians. During this time Indians could only admire the growing industry, technology and investment opportunity associated with bitcoin in developed countries but could not put their hands on it. So it started with the mission Bring Bitcoin to Billions. It had a historic momentum in its traction till April 2018. The notice from RBI on 06th April 2018 restricted banks and financial institutions from providing accounts or other banking services to individuals or entities dealing with crypto assets like bitcoin. RBI never declared crypto assets illegal or restricted its trading activities. It just did want to ring-fence its regulated members like banks. While this eventually got challenged at Supreme Court through the crypto industry supporting association named IAMAI, this left with the option of doing trading using physical cash but the exchange of physical cash is also a regulated activity in India leave alone the issues of bulk cash movements. This pretty much restricted the booming industry of crypto assets as one could not send or receive INR to the exchanges providing this service.
Multiple circumvention techniques have been used by various exchanges but this did not help in bringing back the crypto industry glory. The industry just had to witness the progress in other developed countries without being able to innovate similarly due to RBI restrictions to banks.
P2P (Peer-to-peer) model used to transfer money can have one of the exchange’s customers to swap INR balance at the exchange to actual INR being received to their bank account from another customer. This as well violated the RBI notice to the bank but the victim banks used to process the transaction without knowing that it is happening for crypto assets trading. The other issues involved difficulty in explaining the reason for money going in/out of their bank account (as now one cannot say it is happening for crypto trading), to whom the payment is happening and recipient genuineness, mess with hacked bank accounts and reversals, attempting to use multiple bank accounts and wallet services to avoid falling into the purview of the banks, dependency on the recipient confirming the incoming INR to their bank account etc. Based on these challenges and not wanting the banks to violate their restriction, Unocoin and its lawyers cautiously chose not to get involved with P2P.
By October 2018, the option that Unocoin wanted to move ahead is installing Kiosk machines across the metropolitan cities and continue expanding to tier-2 cities that will enable the cash collection and cash deposition for their customers. While this was called as an ATM to keep the terminology simple, calling so attracted the attention of the media in the wrong direction that tried drawing the parallels with Bank ATM. As per the RBI restrictions, the bank ATMs can only be installed after obtaining permission from RBI because these bank ATMs are to be treated as a mini branch office of those banks itself. The beautifully crafted and well-secured machines (same machines used by banks) were modified to contact Unocoin servers to enable its customer’s deposit and withdrawals INR subject to cash handling limits in India. While these kiosks were in field testing stage, the branding oversight by calling it ATM and unmanageable media attention triggered the Cyber Crime police to take the two founders of Unocoin to custody for enquiring about how the ATM was getting installed without permission from RBI. This created enough confusion in the industry and along with the non-conclusion of a legal battle about non-requirement of permission from RBI, Unocoin could never take these machines live. As per the Unocoin founders and their lawyers, these Kiosks were a fully legitimate way to enable INR transactions for their customers than attempting the P2P.
So this Kiosk confusion left Unocoin to only get back to its full-scale business after the RBI restriction was lifted by the Supreme Court. The minuscule revenue being generated through the crypto to crypto transactions was insignificant to work on scaling up and to grow it as the sole business.
While the rest of the crypto industry and every crypto media has been providing moral support to the uphold the crypto fire, the real front line heroes had to be fighting at the Supreme Court against the very strong opponent RBI and solely based on what happens at the court, the verdict would get passed. The media, social media like twitter, on-ground events and whatever sounds crypto influencers and industry were doing did not have any effect on the present verdict, but these definitely mattered to make the crypto community stronger and bigger which will eventually pay off someday to all the stake-holders of the industry.
Most of us have not seen or do not know how the Supreme Court functions. You would be surprised to know that as a general public, you need to be carrying paperwork from your lawyers to get a pass that will enable you to go into a court hall to hear the arguments. While the crypto industry and IAMAI have helped numerous times with data and numbers to support the industry arguments at the court, I would like to highlight three heroes who stayed away from their homes during every hearing week (more than 20 weeks in total), have worked past mid-nights, have patiently and silently waited for the entire day on many days when the crypto matter did not reach to be heard by the court due to other cases and its arguments happening there. Their recognition could get easily diluted due to the influential media and social media but it would be the industry’s duty to recognize them. Without any of the three, we would not have been where we are now. A 180-page judgement is one of the evidence to understand the efforts being put in. They have fought hard to get the RBI banking ban finally lifted today.
Based on the efforts being put, the highest rank goes to Advocate Jaideep Reddy from Nishith Desai Associates. His unparalleled hard work is seen in piles and piles of documents produced at the court which ranges from simple common-sense arguments to written arguments of arguments happened at previous session in the court to highlighting judgements from similar past cases that could date back to many tens of years, putting together the arguments to be presented by the senior counsel and strategising every step.
The next rank goes to Advocate Ashim Sood. He is the arguing counsel who fought on his legs at the court. This is the first case about crypto in Supreme Court that is fought at length. All the new technology and terminologies bring a lot of challenges for the counsel unless he gets involved as much as other industry players or influencers do. Ashim’s efforts go much beyond standing in the court for more than 6 hours per day on every arguing day. There is at least an equal amount of efforts to be put in the preparation of the initial documents to be submitted to the court, taking inputs from Jaideep, digging deep into dozens of past cases every week and finding the
supporting arguments etc.
The last person I would highlight is Mr Harish B V — one of the co-founders for Unocoin. One of the strong points that made the industry win the case is about human rights. It is the right of every individual to have the bank account and do the transactions as long as the transactions are not illegal. But the RBI’s notice is against this principle. On the other hand, the petitioner being IAMAI (an association) cannot do this claim and it can only be made by an individual. So Mr Harish B V has been that individual and it has made him go to the court for every hearing. Given he is also an industry veteran with the hands-on experience in Unocoin for 7 years, he also got involved in deciphering the technology, doing research and helping Jaideep and Ashim on every argument day that also eventually became a reason for the smooth verdict. It is his first-hand info about the herculean procedures and efforts being put to fight the case is what has made me write this article.
On behalf of Unocoin, I would like to pay my tribute to these unsung heroes. The trio working in tandem has made the industry future brighter in India. While the contributing and continuous industry members at IAMAI include Unocoin, WazirX and PocketBits only, the win belongs to the entire crypto community in India. Since the reason for inception up to this court verdict, Unocoin has worked with a single agenda in mind — It is enabling Indians to have access to bitcoin and crypto. We would continue to “March Forth” with this agenda and hope to have all the support we could get from crypto industry, community, regulators and enforcers.
CEO and Co-Founder at Unocoin