Shaktikanta Das, Governor of the Reserve Bank of India (RBI), has reaffirmed his position in asking for the prohibition of cryptocurrencies because they are speculative and similar to gambling.
According to Das, the RBI’s position on cryptocurrencies is unchanged, noting that they should be viewed like gambling activities rather than as financial products, India Today reported on January 13.
“Anything whose cost is only primarily based totally on conjecture is not anything greater than natural speculation, or, to position it greater crudely, gambling. In our nation, gambling is not permitted. If you wish to permit gambling, you must treat it as such and establish regulations. He said it is a fundamentally wrong argument to claim that cryptocurrency is a financial asset or product.
The threat posed by crypto
Das claimed that the lack of underlying value in cryptocurrencies poses the greatest threat to the financial sector, and he cautioned that allowing digital assets to flourish will undermine the bank’s role in regulating the money supply.
The governor stated that despite calls to outlaw cryptocurrencies, the government must embrace blockchain technology because of its inherent advantages. According to Finbold, RBI has argued for the ban of private cryptocurrencies at some time, expressing concern that digital assets could trigger the next financial crisis.
Countering private crypto
The bank has recently published a concept note and is pushing for introducing a central bank digital currency (CBDC) to combat the rise of cryptocurrencies like Bitcoin (BTC). Meanwhile, the country’s crypto and blockchain businesses have reacted negatively to the note, calling it backwards.
It is important to note that India has argued in favour of a worldwide approach to cryptocurrency regulation, emphasising the industry’s international nature. Despite the uncertainties surrounding cryptocurrency rules, India continues to represent a sizable portion of investors in digital assets.