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<ul><li>The Reserve Bank of India (<keyword id="30067" type="General" weightage="100" keywordseo="rbi" source="Orion">RBI</keyword>) has made no bones about it being averse to <keyword id="2721952" type="General" weightage="80" keywordseo="crypto" source="Orion">crypto</keyword> currency.</li><li>RBI Governor <keyword id="6359111" type="General" weightage="50" keywordseo="shaktikanta-das" source="Orion">Shaktikanta Das</keyword> has, in fact, sought an outright ban on it, while making his views clear on it at several platforms in the last two years.</li></ul>The Reserve Bank of India (RBI) has made no bones about it being averse to crypto currency, ever since it emerged on the horizon in the country a few years ago. RBI Governor Shaktikanta Das has, in fact, sought an outright ban on it, while making his views clear on it at several platforms in the last two years. "Crypto should be banned, given its no underlying value in the market. Just like every asset, every financial product comes with some underlying value, hence the value of crypto is totally based on the make-believe factor," he had said in January this year during a media event. "Crypto is a form of gambling without any underlying value and is nothing but a 100 per cent speculation world," he had said in the same event, while seeking a ban on it. If crypto is allowed in India, the RBI may likely fail in monitoring the transactions, Das has said. The RBI governor has gone on to say that crypto masquerading as a financial asset is a completely misplaced argument. Calling crypto as a form of gambling, Das has said that gambling is not promoted in India and if people still want to indulge in it, then there is a need to draw proper rules for it, while calling for an outright ban on it. He has said that crypto products need to be looked at and, going forward, the effort is to develop an international framework, an international architecture to deal with this problem. What's happening to the <keyword id="6791630" type="General" weightage="80" keywordseo="cbdc" source="Orion">CBDC</keyword>? Although the RBI has vehemently opposed cryptocurrency, its own Central Bank Digital Currency (CBDC), which had been launched as a pilot project on December 1, 2022, for retail use, is ready to target one million users by the end of this month. This was informed by the RBI on Thursday during the post repo rate announcement press conference. While it has no specific date in mind for a full-fledged launch of the CBDC, the central bank will take a measured approach, it said. The RBI also has plans to make the united payments interface (UPI) platform fully interoperable with the CBDC. "We are not targetting a specific date, it will be a calibrated approach," T. Rabi Sankar, deputy governor, RBI had said on June 8. "We want to assess the impact and learn as we go. By the end of June, we are targeting 1 million CBDC users. We are also planning to make UPI QR code interoperable with CBDC," he added. The matter of banning Crypto As far as completely banning cryptocurrencies, back in July 2022, <keyword id="25455" type="General" weightage="50" keywordseo="finance" source="Orion">Finance</keyword> Minister <keyword id="129243" type="General" weightage="50" keywordseo="nirmala-sitharaman" source="Orion">Nirmala Sitharaman</keyword> had said that a stand could be taken only after considerable international collaboration on the risks, benefits, evolution of a common taxonomy and standards. "Cryptocurrencies are by definition borderless and require international collaboration to prevent regulatory arbitrage. Therefore, any legislation for regulation or for banning can be effective only after significant international collaboration on evaluation of the risks and benefits and evolution of common taxonomy and standards," Sitharaman had told Parliament in a reply. Earlier this year, though, during the meeting of the G20 finance ministers central bank governors (FMCBG) held in Bengaluru in February, it was decided that once the International Monetary Fund (IMF) and the Financial Stability Board (FSB) formulate a technical paper in a bid to attain a coordinated global approach for the regulation of crypto assets as proposed by the Indian presidency of the G20, it will form the basis for future discussions to develop an international architecture. Sitharaman had said after the FMCBG meeting that cryptocurrency regulation was discussed by a panel on February 23, 2023 and would again come up during the meeting scheduled in July 2023. A synthesis of the two studies -- by IMF and FSB -- would be considered in September this year, which will lead towards creation of a global policy approach on this matter (regulation of cryptocurrency), she had informed.

RBI gets set to float it's digital currency -- check details here

The framework - crypto regulation & India

<ul class="summary-list"><li>The best option for <keyword id="11892747" type="UNKNOWN" weightage="60" keywordseo="india" source="Orion">India</keyword> is to ban private cryptocurrencies, one of the country's top central bankers said Monday.</li><li>Private <keyword id="11893898" type="UNKNOWN" weightage="60" keywordseo="crypto" source="Orion">crypto</keyword> is worse than Ponzi schemes and pose a threat to financial stability, Rabi Sankar said.</li></ul>India's best choice is to ban private cryptocurrencies because of the risks they pose to the country's financial systems and sovereignty, a top central banker has warned.Rabi Sankar, deputy governor of the <keyword id="11894000" type="UNKNOWN" weightage="60" keywordseo="reserve-bank-of-india" source="Orion">Reserve Bank of India</keyword>, took aim at private crypto in a <a href="https://m.rbi.org.in/Scripts/BS_SpeechesView.aspx?Id=1196">speech at a local banking conference</a> on Monday, underlining Indian authorities' tough stance. He said cryptocurrencies can't really be defined as a currency, asset, or commodity, given that they don't have any underlying cash flow or intrinsic value, and that they are like a "Ponzi" scheme or even worse. For these reasons alone, private cryptocurrencies should be kept away from the formal financial system, he said."More substantially, they can (and if allowed most likely will) wreck the currency system, the monetary authority, the banking system, and in general government's ability to control the economy," Sankar said. This adds up to a threat to a country's financial sovereignty, he warned. It becomes vulnerable to manipulation by the private companies that create digital currencies or the governments that control them, according to Sankar."All these factors lead to the conclusion that banning cryptocurrency is perhaps the most advisable choice open to India," he told the conference.Sankar's tough words highlight Indian authorities' efforts to keep a grip on digital currencies in a country with an estimated 15 to 20 million crypto investors. India is second only to Vietnam in crypto adoption, according to the <a href="https://blog.chainalysis.com/reports/2021-global-crypto-adoption-index/">2021 Global Crypto Market Adoption Index</a> from Chainalysis.The government plans to <a href="https://markets.businessinsider.com/news/currencies/india-crypto-blockchain-cbdc-tax-ethereum-bitcoin-digital-assets-finance-2022-2">impose a 30% tax</a> on income from cryptocurrencies and other digital assets such as NFTs, or non-fungible tokens. It also wants to deduct 1% in tax at source on payments related to buying such assets.While<a href="https://www.businessinsider.in/cryptocurrency/news/taxes-gst-and-the-digital-rupee-crypto-policy-in-india-is-going-through-a-big-overhaul/slidelist/89499051.cms#slideid=89499616"> many</a> saw this as a move towards legitimizing crypto,<a href="https://www.businessinsider.in/cryptocurrency/news/taxes-gst-and-the-digital-rupee-crypto-policy-in-india-is-going-through-a-big-overhaul/slidelist/89499051.cms#slideid=89499616"> some</a> were worried the high tax might discourage crypto trading. At the same time, India plans to roll out its own digital currency, nicknamed the "digital <keyword id="6355302" type="UNKNOWN" weightage="60" keywordseo="rupee" source="Orion">rupee</keyword>," suggesting it is the private nature of private cryptocurrencies that is worrying authorities.India plans to introduce its <keyword id="11939356" type="UNKNOWN" weightage="60" keywordseo="central-bank-digital-currency" source="Orion">central bank digital currency</keyword>, or <keyword id="6791630" type="UNKNOWN" weightage="60" keywordseo="cbdc" source="Orion">CBDC</keyword>, before March 2023. Major central banks such as the US Federal Reserve and the Bank of England are already developing CBDCs, which provide a centralized, official alternative to pure cryptocurrencies. But it is the Chinese central bank that is leading the way in CBDCs, and is it several years ahead of its counterparts in its development program. Its <a href="https://markets.businessinsider.com/currencies/news/digital-yuan-china-central-bank-currency-visitors-2022-winter-olympics-2021-4-1030316791">digital yuan</a> is in use at the Beijing Winter Olympics on right now.Lawmakers in India's lower house in December introduced a bill to <a href="https://www.businessinsider.com/crypto-investing-india-ban-bitcoin-retail-investors-kimchi-premium-cbdc-2021-11">prohibit all private cryptocurrencies</a>, but the government later said it could instead <a href="https://markets.businessinsider.com/news/currencies/crypto-ban-india-regulate-bill-fines-sebi-cryptocurrency-digital-asset-2021-12">bring in regulation</a>.But Sankar said none of the arguments for crypto regulation stand up to basic scrutiny. "We have seen that crypto-technology is underpinned by a philosophy to evade government controls. Cryptocurrencies have specifically been developed to bypass the regulated financial system. These should be reason enough to treat them with caution."

India should ban 'Ponzi' private cryptos or risk wrecking the country's financial system, a top RBI central banker has warned

<ul class="summary-list"><li>The <keyword id="6354335" type="ORGANIZATION" weightage="60" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> on Thursday said it is considering a "phased" rollout of a <keyword id="6472011" type="UNKNOWN" weightage="60" keywordseo="Central-Bank-Digital-Currency">central bank digital currency</keyword>.</li><li>Deputy Governor T. Rabi Sankar said a <keyword id="6791630" type="UNKNOWN" weightage="60" keywordseo="CBDC">CBDC</keyword> will protect citizens from the volatility of cryptocurrencies, <a href="https://www.bloomberg.com/news/articles/2021-07-22/india-eyeing-phased-roll-out-of-central-bank-digital-currency">Bloomberg</a> reported.</li><li>But Sankar added that a launch will need to overcome some legal hurdles first.</li></ul>The Reserve Bank of India on Thursday said it is considering a "phased" rollout of a central bank digital currency.Deputy Governor T. Rabi Sankar during a speech said politicians are eyeing a CBDC to protect citizens from the volatility of cryptocurrencies, <a href="https://www.bloomberg.com/news/articles/2021-07-22/india-eyeing-phased-roll-out-of-central-bank-digital-currency">Bloomberg</a> first reported.A digital currency, he said, will also decrease cash usage in India's economy, especially as more consumers adopted offerings like <a href="https://e.insiderintelligence.com/click/23223491.4/aHR0cHM6Ly9jb250ZW50LW5hMS5lbWFya2V0ZXIuY29tL2dsb2JhbC1jYXNoLXVzYWdlLWV4cGVjdGVkLWRyb3Atb2ZmLXNoYXJwbHktbmV4dC0zLXllYXJzLWhlcmUtcy13aGF0LXRoYXQtbWVhbnMtbW9iaWxlLXdhbGxldHMtY2FyZHMtYWNyb3NzLWdsb2Jl/5d233c18f730436f2414784fBcece84c2" target="_blank" rel="noopener">contactless payments</a> during the pandemic."Central banks have increased their attention on digital currencies," Sankar said.A CBDC is a type of central bank liability issued in digital form, which could be used by the general public.Sankar added that an introduction of a CBDC will need to overcome some legal hurdles in foreign exchange rules and information-technology laws.In the US, Federal Reserve <keyword id="1727754" type="PERSON" weightage="60" keywordseo="Jerome-Powell">Jerome Powell</keyword> <a href="https://markets.businessinsider.com/currencies/news/jerome-powell-cryptocurrencies-cbdc-stablecoins-digital-currency-testimony-2021-7">questioned</a> the necessity of cryptocurrencies once the Fed rolls out its own CBDC.Powell in <a href="https://markets.businessinsider.com/currencies/news/federal-reserve-central-bank-digital-currency-cbdc-research-report-summer-2021-5?utm_source=markets&amp;utm_medium=ingestgest" target="_blank" rel="noopener">May</a> revealed that the central bank has taken further steps in exploring a digital currency and will be releasing a discussion paper this summer outlining its thinking on digital payments. Apart from the US, a <a href="https://markets.businessinsider.com/news/stocks/fed-boston-president-rosengren-cbdc-central-bank-digital-currency-launch-2021-5-1030422818?utm_source=markets&amp;utm_medium=ingestgest" target="_blank" rel="noopener">number of central banks</a> have been exploring CBDCs, spurred by strong momentum in the cryptocurrency space. China has been leading the government-backed digital currency race since developing its CBDC in 2014 and testing a pilot program in 2020. The statement from the Indian deputy governor follows the European Commission's proposal to <a href="https://markets.businessinsider.com/currencies/news/european-union-ban-anonymous-cryptocurrency-counter-money-laundering-terrorism-financing-2021-7">ban anonymous cryptocurrency transactions</a> as the bloc seeks to clamp down on money laundering and terrorism financing.The Indian government, for its part, has been eyeing cryptocurrency regulation for some time in a bid to prevent terrorism financing and money laundering. A CBDC will remove a certain level of anonymity cryptocurrencies ar known for.

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RBI gets set to float it's digital currency -- check details here

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The framework - crypto regulation & India

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India should ban 'Ponzi' private cryptos or risk wrecking the country's financial system, a top RBI central banker has warned

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India is considering a phased roll-out of a central bank digital currency

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