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Gov: No Boost to Crypto in India. RBI Examining CBDC

Government does not plan to boost crypto in India. RBI is examining the use of Central Bank Digital Currency (CBDC).

On Monday, at the Lok Sabha, the Union Minister of Finance, Ms. Nirmala Sitharaman was asked several questions about cryptocurrency and the Central Bank Digital Currency (CBDC).

Lok Sabha Member of Parliament (MP) from Domariyaganj, Mr. Jagdambika Pal asked Ms. Sitharaman about the Government’s plans of boosting cryptocurrency.

The Finance Minister revealed that the Government has “has no plans for boosting” the crypto sector in India.

Mr. Pal also enquired about the available data on the cryptocurrency exchanges and the size of the industry in India.

An old answer that the Government does not collect data on the “cryptocurrency sector” was restated.

When asked about crypto regulations by the MP from Hassan, Mr. Prajwal Revanna and Mr. Pal, she replied that the Bill on Cryptocurrency and Regulation of Official Digital Currency has been listed for introduction during the ongoing Winter Session. It will create the required regulatory framework.

Further, the question of whether the Government proposes to start a digital currency in the country and will it substitute the cryptocurrency was put forth by MP from Jabalpur Mr, Rakesh Singh.

Ms Sitharaman explained that

“Central Bank Digital Currency (CBDC) is introduced by a Central Bank. Government has received a proposal from Reserve Bank of India (RBI) in October, 2021 for amendment to the Reserve Bank of India Act, 1934 to enhance the scope of the definition of ‘bank note’ to include currency in digital form.”

Nirmala Sitharaman, Union Minister of Finance

RBI is examining the use and risks and will roll it out in a phased manner.

She also stated that CBDC would provide a robust, efficient, trusted, regulated and legal tender-based payments option. The CBDC will be backed by the Government. So, she opined that it will not be volatile, unlike private cryptocurrencies.

Currencies have evolved throughout history, from metal to paper. Now, it is moving towards a digital store of value. Cryptocurrencies were earlier considered as just a short term craze among the youth. Today, they are seen as a new asset class.

What do you think is the monetary future of the world? Comment below.

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