Shaktikanta Das, Governor of the Reserve Bank of India, stated on Thursday that private cryptocurrencies pose a significant risk to the country’s financial and macroeconomic stability. He also stated that anyone who invest in private cryptocurrencies do so entirely at their own risk.
“On cryptocurrencies, we have stated our view unequivocally. Private cryptocurrency poses a significant danger to macroeconomic stability. Private cryptocurrencies will impair the RBI’s ability to deal with financial stability concerns,”
he warned at a news conference following a Monetary Policy Committee meeting on Thursday.
He also stated that private cryptocurrencies have no intrinsic value.”It is my responsibility to remind investors who invest in cryptocurrencies that they are doing so at their own risk.” “They should also keep in mind that cryptos, like tulips, have no underlying value,” Das added.
Views on digital rupee
“There will be no difference between a Digital Rupee and the normal rupee,” the Governor said.
Das stated that the RBI is proceeding cautiously and cannot provide a date for the planned digital rupee.According to RBI Deputy Governor T Rabi Shankar, it would be one-to-one convertible and will be the same as a standard paper rupee.
“It will only exist in electronic or digital form, and it will be technologically accessible via your cell phone.” “There will be no distinction between the physical and digital rupees,” he added, adding that it will be issued by the RBI and will be included in the central bank’s obligations.
Cryptocurrencies, on the other hand, are unique and personally generated things, he added.
He also stated that technological options are open, and that much would rely on the use case.
The Union Budget 2022-23, released on February 1, proposes a 30% tax on virtual digital assets.
Earlier in the day, the Reserve Bank’s monetary policy committee (MPC) kept the repo rate, or lending rate, at 4% and the reverse repo rate, or key borrowing rate, at 3.35 percent.
Since May 2020, the central bank has held the key repo rate at record lows and has consistently emphasised that it will continue to promote growth and maintain an accommodating stance until the economy has completely recovered.
The RBI has maintained its growth prediction of 9.2 percent and inflation forecast of 5.3 percent for the current fiscal year (2021-22).