More Bad News! Digital Rupee Can Kill The Case For Cryptos Like Bitcoin, Says RBI Deputy Governor

Seems like the misery just keeps on piling up for crypto enthusiasts in India.

If the heavy tax impositions and multiple harsh statements by the RBI governor Shaktikanta Das in the past weren't already enough, the latest statement by the deputy RBI governor T Rabi Sankar signals further bad news for the crypto industry.

As per a PTI report, RBI Deputy Governor T Rabi Sankar yesterday said that the soon-to-be-introduced central bank digital currencies (CBDCs), i.e. digital rupee, can "kill" whatever little case that exists for private virtual currencies like Bitcoin. But he didn't exactly pinpoint or clarify how it will happen.

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This statement comes ahead of the government coming out with a consultation paper on cryptocurrencies.

Earlier this week, the Department of Economic Affairs in the Ministry of Finance had said it will soon be coming out with a paper on such private cryptocurrencies.

While speaking at a seminar organized by IMF, Sankar said "We believe that CBDCs could actually be able to kill whatever little case that could be for private cryptocurrencies."

He added that the RBI has been working "methodically" to introduce a digital version of the fiat rupee and sees advantages like better currency management, reducing settlement risk in the system especially the interbank system, and as the best solution to cross-border payments.

"I would expect the IMF will take a leading role in clearing the narrative, whether it's in respect of CBDCs or cryptocurrencies," he said, as per the PTI report.

"We will go through the process of proofs of concept, then pilots and then a stage-wise introduction. We intend to learn as we go, as all of us realize the digital journey is precisely that, it's a journey that never has an end," he reportedly added.

T Rabi Sankar also said that a government and regulator-led process with the right vision and implementation can achieve social objectives more effectively.

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Also Read: RBI Governor Drops More Bombshells On Crypto After 30% Tax, Says Its 'Not Even A Tulip'

Attacking Stablecoins

Sankar also reportedly attacked 'stable coins' which are pegged to a particular currency.

At a time when advocates of cryptocurrencies have been batting for 'stable coins' which are linked to regulated currencies, Sankar said their "unquestioned acceptance" seems "puzzling".

"Yes, I've heard repeated central bankers trying to justify private currencies by arguing that we have changed, we have private money largely in the system. Now I'm sure they understand the difference between money and currency," he said.

Also Read: Many Indians See Future In Crypto, Govt Sees Possibility Of Revenue: FM Sitharaman

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