RBI Believes That Crypto Should Be Outlawed Because It Will Lead To The “Next Financial Crisis”

Key Point:

• The governor of the Reserve Bank of India expressed his opinion that it would be wise to outlaw private cryptocurrencies because they will trigger the “next financial crisis.”
• Shaktikanta Das is still upbeat about central bank digital currencies and the RBI’s ambitions for a digital rupee, nevertheless.

Shaktikanta Das, governor of the Reserve Bank of India (RBI), stated that it is necessary to outlaw private cryptocurrencies since continuing to use them would trigger the “next financial disaster.”

Das reaffirmed that the RBI thinks it should be illegal to use private cryptocurrencies. “Please take note: private cryptocurrencies will cause the next financial crisis, Das stated on Wednesday at the Business Standard BFSI Insight Summit. They have no intrinsic worth. They carry significant inherent hazards to the stability of our economy and finances. I have not yet heard a convincing defense of the public good or purpose it serves.”

The governor of the central bank particularly cited the defunct cryptocurrency exchange FTX as an illustration of the need for a ban on cryptocurrencies.

“After all the developments over the last year, including the latest episode on FTX, I don’t think we need to say anything more about our stance,” Das said.

At the same time, Das remains positive regarding central bank digital currencies and the RBI’s plans for a digital rupee, stating:

“You will see in days to come more and more central banks will embrace digital currencies and India has been in the forefront of the digital revolution in the current century.”

India assumed the presidency of the G20 in December, to receive the authority to determine the agenda for global crypto regulatory discussions. India’s term will end on Nov. 30, 2023.

India finance minister Nirmala Sitharaman said in November that crypto regulation should be an international priority and topic of discussion during India’s G20 presidency

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