The Reserve Bank of India (RBI) has reiterated its position of completely banning the use of cryptocurrencies as a means of payment and tradable property. Leading government officials expressed the opinion that the Central Bank does not see any benefit in granting permission to cryptocurrency companies.
Bank officials believe that private cryptocurrencies threaten macroeconomic stability, violate India’s monetary sovereignty, create risks for consumers and facilitate illegal activities such as money laundering and terrorist financing. At best, officials consider crypto assets gambling.
“The Central Bank of India has always advocated a complete ban. The government cannot ignore the concerns of the RBI when regulating cryptocurrencies, since the Central Bank is responsible for the sustainability of monetary policy and maintains price stability,” explained an official close to the government.
Although Indian authorities are engaging with stakeholders on the issue of regulating cryptocurrencies, India may tighten oversight of digital assets and even ban them completely. The final decision has not yet been made, the official assured. According to the RBI, launching its own digital currency will be advisable as it will become another tool for the development of the digital economy.
The Central Bank believes that the digital rupee will provide consumer protection and become an alternative to private cryptocurrencies. In May, the RBI expanded the retail digital rupee pilot to inсlude more participating banks and cities. However, according to an RBI report, the digital rupee has not become popular among retail users.
