Crypto Threatens Rupee Stability, Urges Investors to Be Careful
India’s central bank governor, the Reserve Bank of India (RBI), has warned of significant risks associated with cryptocurrencies, especially for emerging market economies. “It can affect your financial stability, currency stability and monetary system,” said RBI Governor Shaktikanta Das.
Crypto Warnings from RBI Governor
Shaktikanta Das, governor of India’s central bank, the Reserve Bank of India (RBI), issued several warnings about cryptocurrency at the World Economic Forum in Davos this week. Said:
“There is no underlying. The central bank of India said, “It is not a currency, but it has the potential to become a currency and in that case it can occupy some part of the system payments. It can affect your banking system and so there is a lot of risk involved,” the governor emphasized.
Commenting on the approval of spot bitcoin exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC), Das said: “While others may see a renewed batch of cryptocurrency, we see significant risks.” He stated that the US SEC is responsible for “the welfare of their nation, and we for the welfare of ours.” The RBI governor further said: “Some are celebrating this as a new batch, but they forget the crash a few years ago. Volatility, money laundering and terrorist financing risks are inherent in these assets.”
The governor of India’s central bank also said:
Das has long been a vocal critic of Bitcoin and cryptocurrency. In January last year, he reiterated his strong recommendations for a complete ban on cryptocurrencies in India. “The idea that cryptocurrency is a financial product or financial asset is a completely false argument,” he emphasized. “The Reserve Bank, which is the monetary authority of the country as the central bank, will lose control over the money supply in the economy… It will weaken the authority of the RBI and lead to dollarization of the economy.”
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