Deputy Governor of the Reserve Bank of India predicts that CBDCs would be the death of crypto
Central bank-issued digital currencies (CBDCs), according to the Reserve Bank of India (RBI), would put an end to private cryptocurrencies.
Indian Times reported on June 3 that Bank of India Deputy Governor T. Rabi Sankar said private cryptocurrencies have the potential to be used for negative purposes, notwithstanding their excellent technology.
The Indian government’s opposition to cryptocurrencies has been bolstered by Sankar’s stance on private coins.
He said, “We feel that the use of CBDCs might essentially eliminate any potential for private cryptocurrencies,” Sankar.
The RBI’s position on CBDCs and private digital assets, on the other hand, has been roundly criticised by many in the crypto industry. The CEO of Giottus crypto exchange, Vikram Subburaj, argued that the RBI prediction is an attempt to restrict innovation in the crypto market.
International Monetary Fund (IMF) spokeswoman Sankar said that the IMF should lead the global discussion on cryptocurrency regulation.
Government officials have revealed that they looked at legislation from other countries while drafting India’s consultation paper on cryptocurrency regulation, which has gained momentum in the previous year.
Shaktikanta Das, governor of the Reserve Bank of India (RBI), has already highlighted many outcomes that might result from the legalisation of cryptocurrencies. Das, according to Finbold, cautioned that the dollarization of the country’s economy might be a result of the denomination of most cryptocurrencies.
According to him, the dollarization of the Indian economy is detrimental to the country’s sovereignty and a danger to financial stability.
Many new legislation have been introduced recently as the government draws closer to passing a law that governs the industry. In this year’s annual budget, for example, the government committed to tax cryptocurrency income at a rate of 30%.
Since Terra’s recent fall, which resulted in millions of individuals losing their money, the need for cryptocurrency regulation has been stronger than ever. The government, via the Reserve Bank of India (RBI), has previously advised people against investing in crypto assets at a time when digital assets are becoming more popular in the country.