The central bank has long been wary of cryptocurrencies and only sees them as a possible threat to fiat money.
According to cryptocurrency players, cryptocurrencies are a solution to many financial issues. However, RBI governor Shaktikanta Das told a television channel that since all cryptocurrencies are priced in hard currencies, primarily the dollar, they will not benefit nations like India. It might be used improperly as a tool for money laundering, he added.
Crypto gamers claim that the governor of the RBI’s remarks are not brand-new.
The central bank has always viewed cryptocurrencies with scepticism and only sees them as a possible threat to fiat money. But this is not entirely accurate. Cryptocurrencies are neither a danger to a country’s financial system nor a substitute for any fiat currency of the nation, according to Dileep Seinberg, founder and CEO of MuffinPay, a cryptocurrency for bill payments and utilities.
Digital assets are currently not covered by many Indian regulations, which leaves possibility for misunderstanding and abuse. According to Anoush Bhasin, an angel investor and advisor at KoinX, the best course of action is to establish a comprehensive regulatory framework that safeguards the regulator’s interests while fostering the most promising innovation of the decade.
The government has been asked by the RBI to create regulations for cryptocurrencies, according to Finance Minister Nirmala Sitharaman’s statement from last month, which took into account their destabilising impact on a nation’s monetary and fiscal stability.
Cryptocurrencies can provide quick, inexpensive, and safe transactions for small investors. It can serve as an inflation hedge. Furthermore, it can aid in improving portfolio diversification away from conventional assets like stocks or bonds, according to Edul Patel, CEO & Co-Founder of Mudrex, a cryptocurrency investment platform.
In addition to global concerns, the Indian cryptocurrency business has started experiencing layoffs, the “crypto winter,” and a decline in exchange volume due to the new TDS law.
Rajgopal Menon, vice president of WazirX, responded that the cryptocurrency market is still one of the safest investment possibilities because of the nature of the sector. He asserted that for the ecosystem to develop while keeping customer interests and safety at the forefront, legislators and regulators need to foster a more supportive and cooperative atmosphere.
Menon noted that there are currently 35 million cryptocurrency users in India. The GoSats CEO and co-founder Mohammed Roshan disagrees with the claim about financial instability. “In particular, bitcoin can help the nation’s economy. I believe the RBI and government need to view bitcoin differently from other forms of cryptocurrency.
Prasanta Patnaik