India’s central bank has reiterated its stance on banning cryptocurrencies such as bitcoin and ether. The Governor of the Reserve Bank of India (RBI) compared cryptocurrency trading to gambling. He warned that cryptocurrencies will “undermine the authority of the RBI and lead to the dollarization of the economy.”
RBI Governor Wants Cryptocurrency Banned
The governor of India’s central bank, the Reserve Bank of India (RBI), Shaktikanta Das, emphasized the bank’s stance on cryptocurrencies at the Business Today Banking and Economics Summit on Friday.
Das stressed that the central bank’s view is to completely ban cryptocurrencies like bitcoin and ether, India Today reported, quoting him as saying, “RBI’s position on cryptocurrencies is very clear: it should be banned.”
Emphasizing that cryptocurrencies have no underlying value, the Indian central bank governor described:
Some people call crypto an asset, others call it a financial product, but every asset or financial product must have an underlying value. But the cryptocurrency does not have any underlying value.
Das proceeded to express his opinion on the market prices of cryptocurrencies, stating that they are based solely on speculation. He compared cryptocurrency trading to gambling.
“Anything whose valuation depends entirely on fantasy is nothing more than 100% speculation, or to put it bluntly, it is a gamble,” the RBI chief emphasized. “In our country, we do not allow gambling. If you want to allow the game, treat it like a game and set the rules.”
Reiterating that he does not see crypto as a financial product, the central banker said:
Cryptocurrency masquerading as a financial product or financial asset is a completely misplaced argument.
Das also warned about the risks that cryptocurrencies pose to the Indian economy. He warned:
The Reserve Bank, being the monetary authority of the country as the central bank, will lose control over the money supply in the economy… It will undermine the authority of the RBI and lead to the dollarization of the economy.
RBI officials similarly warned in May of last year that cryptocurrencies could lead to the dollarization of part of India’s economy “which will go against the country’s sovereign interests.”
India currently does not have a regulatory framework for cryptocurrencies. The government has been working on a crypto bill for several years. India’s Finance Minister Nirmala Sitharaman said in October last year that the government hopes to discuss cryptocurrency regulation with the G20 countries to establish a technology-driven regulatory framework for cryptocurrency assets.
What do you think of the statements by RBI Governor Shaktikanta Das? Let us know in the comments section.
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