Despite the rumors about the upcoming bill to ban cryptocurrency trading, the RBI’s position on digital assets has become more optimistic.
According to a report published after a study of the payment industry in India, the regulator’s experts recognize that cryptocurrencies have become popular all over the world. However, Indian regulators and local governments are skeptical and even wary of them.
The RBI called state-owned stablecoins are legitimate means of payment, which should be considered as an obligation to the central bank digital form. Therefore, the Bank of India will begin to study whether there is a need to launch a digital version of the national currency, and, if it is economically feasible, the RBI will explore possible options for its use.
The Indian government has a rather complicated relationship with digital assets. In 2018, the RBI banned banks and financial institutions from providing services to firms working with cryptocurrencies.
However, in March 2020, the Supreme Court of India overturned the RBI directive prohibiting the use of crypto assets. After that, many trading platforms appeared in the country, but Indian traders still express concerns about the future of the cryptocurrency industry in India.
According to the RBI, the volume of digital payments in the country is 43%, and in 2011 this figure was 12.5%. The bank said that it can expand the introduction of digital payments, focusing on the needs of the younger generation, which easily adopt new technologies. If such a large bank and strict regulator launched its own digital currency, other central banks could follow suit, speeding up the development of their CBDC’s.