SBI's action against bank account holders dealing in crypto

[Clement Kaliyar]

~snip
Possibility of your transaction get noticed is fairly less but if they know this involves cryptos then they might send you a warning first.
One of my social media friend also receives warning from kotak and his account is not accessible for couple of days.

What happened after that, after getting the warning what happened and i am sure his account is accessible after a couple of days because i am in contact with an user in the crypto community who is having communication with Kotak authorities and he assured that there is no account confiscated till now in India and i trust his inference. With the transaction i conducted recently i am waiting for a warning, lets see whether they are sending something and my intuition is that they are not going to do that because i have received many huge transactions after the RBI ban and i never got anything till now, may be i was lucky.

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[akram143]

~snip
Possibility of your transaction get noticed is fairly less but if they know this involves cryptos then they might send you a warning first.
One of my social media friend also receives warning from kotak and his account is not accessible for couple of days.

What happened after that, after getting the warning what happened and i am sure his account is accessible after a couple of days because i am in contact with an user in the crypto community who is having communication with Kotak authorities and he assured that there is no account confiscated till now in India and i trust his inference. With the transaction i conducted recently i am waiting for a warning, lets see whether they are sending something and my intuition is that they are not going to do that because i have received many huge transactions after the RBI ban and i never got anything till now, may be i was lucky.

Private banks are more reliable to be honest,so informing the bank manager will help the issue to get resolved but he didn't use that account from crypto related transactions so everything is fine for him.

[rsarkar]

These are the different account status that a bank can keep with the depositor that I have encountered:

- Debit freeze : means that customer cannot withdraw money . Prevalent when the account have been used to receive money from other hacked accounts or involved in Ponzi dealings.
- Credit freeze : means that the customer cannot deposit money. Very prevalent in the case of crypto.
- Account closed : permanent.
- Account inactive : temporarily.
- Restricted : restricted use.

If the transactions amounts are big then bank can temporarily restrict account from using other features like creating fd's etc. until customer provides proof of the source of the money.

[Dishant140]

Yes, They closed some accounts in 2017-2018 due to lots of transections. Before they close account they sent inquiry on those accounts. They will warn us to not take any crypto related payment. This is not only in India, there are lots of other countries bank which are not allowing crypto payments.

[Forbiddenone]

Bank account blocking was majorly seen 2 years back and after RBI ban if people are still depositing big funds from known exchange or other services or buying crypto using bank account then i think its their problem as they are not to be fully aware or deliberately doing it. Recent hearing in supreme court RBI said that virtual currency are not ban in country but it can not be used with current banking regularities.

[pawanjain]

I have been using my SBI account since 4 years and have been doing all crypto related transactions from this account only.
I have never faced any issue as such. Though I have heard some  members account getting frozen but it was not an SBI account holder though.
Those of you saying it was just a rumor and they didn't know anybody whose account actually got blocked, I must say I know a person whose account got frozen and the person had to go to the bank to withdraw his money.
But these were the things in the past. From the last 1.5 years there's no issues with the banks.

[lordquanta]

There are numerous reports on bank accounts being closed/blocked due to dealings in bitcoin and other cryptos. The most affected are the customers of Kotak bank. Is there any specific report where an individuals or business bank account has been closed by State bank due to similar reason?

Would you care to share the related links or articles link for further understanding of this issue. So far I've not come across any such incident nor my acquaintances as well. If what you are saying is true then we could check with related bank about any circular issue for the same.

[akram143]

I have been using my SBI account since 4 years and have been doing all crypto related transactions from this account only.
I have never faced any issue as such. Though I have heard some  members account getting frozen but it was not an SBI account holder though.
Those of you saying it was just a rumor and they didn't know anybody whose account actually got blocked, I must say I know a person whose account got frozen and the person had to go to the bank to withdraw his money.
But these were the things in the past. From the last 1.5 years there's no issues with the banks.

Every bank should follow the guidelines of RBI, so there is no exceptions for SBI.If they didn't found anything with transactions related to cryptos then its obviously lazy people working in the government sector that is why they didn't found anything but if they found then surely anyone's account is in the risk of getting frozen.

[libert19]

There are numerous reports on bank accounts being closed/blocked due to dealings in bitcoin and other cryptos. The most affected are the customers of Kotak bank. Is there any specific report where an individuals or business bank account has been closed by State bank due to similar reason?

Would you care to share the related links or articles link for further understanding of this issue. So far I've not come across any such incident nor my acquaintances as well. If what you are saying is true then we could check with related bank about any circular issue for the same.

https://m.rbi.org.in//Scripts/NotificationUser.aspx?Id=11243&Mode=0

The supreme court will give judgement soon let's see if circular lifts or retains!

[legendster]

Nationalized bank accounts should never be trusted or used while dealing with crypto. Also, how can these banks even know about crypto transactions when the deals are p2p?

It is not easy but if they really want to weed out the transactions then they can really do that if you are getting transaction from different accounts across the country they can sort that out who is doing these transactions and they can question you about the different sources of money from different accounts, so it is possible if they really wanted to target users.

I have a history of dealing in wholesale electronics back in the day and my customers were from all across the country as I shipped stuff out from the kolkata port. There was no mention of any commercial or current accounts, most of these transactions occurred through the savings account.  My dad and I primarily used Bank of Baroda, UBI and SBI accounts in our names to do this. And I reckon this is a common practice among traders across all the ports of India.

By your logic, the banks should close down my account because there are multiple payments coming from different sources? Isn't that stretching the imagination a bit too much? There is no way one can track the reason of a crypto transaction through p2p trades. And you guys are forgetting the most important factor of them all. It is not prohibited to trade or acquire cryptocurrencies as individuals. Only the commercial applications are prohibited, as in exchanges, shops, web stores, etc. If you want, you can even get paid in crypto for your services. Of course they do not say this explicitly anywhere but I have checked from numerous high ranking officials who are involved in the crypto taxation process that have confirmed this.

[rsarkar]

Nationalized bank accounts should never be trusted or used while dealing with crypto. Also, how can these banks even know about crypto transactions when the deals are p2p?

It is not easy but if they really want to weed out the transactions then they can really do that if you are getting transaction from different accounts across the country they can sort that out who is doing these transactions and they can question you about the different sources of money from different accounts, so it is possible if they really wanted to target users.

I have a history of dealing in wholesale electronics back in the day and my customers were from all across the country as I shipped stuff out from the kolkata port. There was no mention of any commercial or current accounts, most of these transactions occurred through the savings account.  My dad and I primarily used Bank of Baroda, UBI and SBI accounts in our names to do this. And I reckon this is a common practice among traders across all the ports of India.

By your logic, the banks should close down my account because there are multiple payments coming from different sources? Isn't that stretching the imagination a bit too much? There is no way one can track the reason of a crypto transaction through p2p trades. And you guys are forgetting the most important factor of them all. It is not prohibited to trade or acquire cryptocurrencies as individuals. Only the commercial applications are prohibited, as in exchanges, shops, web stores, etc. If you want, you can even get paid in crypto for your services. Of course they do not say this explicitly anywhere but I have checked from numerous high ranking officials who are involved in the crypto taxation process that have confirmed this.

I believe you are talking about GST here. GST registration is mandatory for turnover of above 20 lakhs of the products and services identified by the GST bill 2017. This bill however doesn't identify crypto. Now let's say you want to deal p2p and there are people who will want to deal with you so there are few options here:
You meet at a commonplace like a coffee shop or car parking or malls. Most exchanges closed down their offices when the Rbi restricted their banking support. It doesn't mean that the entire place is locked down,  only the operation part was hampered. The different govt. Dept. always have a clash between themselves. I agree that not everywhere logic works but where logic fails money talks. May I know what led you to talk to the tax officials?  Let's see what SC judgement would be.

[akram143]

I believe you are talking about GST here. GST registration is mandatory for turnover of above 20 lakhs of the products and services identified by the GST bill 2017. This bill however doesn't identify crypto. Now let's say you want to deal p2p and there are people who will want to deal with you so there are few options here:
You meet at a commonplace like a coffee shop or car parking or malls. Most exchanges closed down their offices when the Rbi restricted their banking support. It doesn't mean that the entire place is locked down,  only the operation part was hampered. The different govt. Dept. always have a clash between themselves. I agree that not everywhere logic works but where logic fails money talks. May I know what led you to talk to the tax officials?  Let's see what SC judgement would be.

It seems he is talking about income tax, every Individual who had recorded transaction in their bank for whatever reasons should pay their income taxes if it exceeds the limits.But when people using p2p hard cash method can stay away from paying taxes but when you are dealing in person there is chance for scam if it involves high amount.