RBI India: Partial ban on cryptocurrencies does not work, must be banned completely

The Central Bank of India, the Reserve Bank of India (RBI), held the 592nd meeting of the Central Bank Council on Friday, December 17, under the chairmanship of Governor Shaktikanta Das. The central board is the bank’s highest decision-making body.

The Board of Directors reviewed the current national and global economic situation, development challenges and remedial actions. They also discuss various aspects related to cryptocurrencies and central bank digital currencies (CBDCs).

RBI said at the meeting that it supports a full ban on cryptocurrencies, noting that a partial ban would not be effective.

Senior RBI officials have highlighted several problem areas related to cryptocurrencies, including the ability to track transactions, ratings, extreme price movements, regulatory issues, and identification of transaction participants.

Governor Das reiterated his anti-crypto stance, stressing that cryptocurrencies pose a serious threat to any financial system as they are not controlled by central banks.

That has repeatedly said that the central bank has serious concerns about cryptocurrencies, which pose a serious threat to macroeconomic and financial stability in India.

“There needs to be a more in-depth discussion about cryptocurrencies. When central banks say they have more concerns from a macroeconomic and financial stability standpoint, there are deeper problems that are part of the problem, “Das said in an October statement.

Cryptocurrencies and regulations of the Official Digital Currency Bill 2021 were listed for consideration during the winter session of the Lok Sabha – House of Representatives of the Indian Parliament. According to reports, the government plans to regulate crypto assets with the Securities and Exchange Commission of India (SEBI) as its main regulator, but bans the use of cryptocurrencies for payments. However, it is reported that the government is still revising the bill and is likely to bring it to the budget meeting.

In the meantime, RBI is also working on a digital rupee and is planning to roll it out in stages. Last week they said there would be two types of CBDCs: wholesale and retail.

“A lot of work has been done on a wholesale-based CBDC while retailing is a bit complicated and will take more time. We will start a test, whichever is available first, ”said RBI Deputy Governor T. Rabi Sankar.

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