The Reserve Bank of India (RBI), India’s central bank, has reportedly shelved plans to launch a central bank digital currency (CBDC) for now, as it “doesn’t want the digital currency” anymore, believes it’s “too early to even think about a digital currency.”
According to local news outlet The Hindu Business, unnamed sources have revealed India’s central bank is no longer looking to launch its own CBDC, but may instead be looking at what other developed countries do, as it doesn’t “have a formal unit for tracking of, and policy-formation on” cryptocurrencies and blockchain technology.
The news outlet’s source was quoted as saying:
The government doesn’t want the digital currency any more. It thinks it is too early to even think about a digital currency.
The RBI initially revealed it was looking into the possibility of launching a cryptocurrency in April of 2018, when it established a group to look into its potential advantages. Reportedly, its idea would be to better control money laundering and cybersecurity threats, among others, through its CBDC.
As CryptoGlobe covered, in October a private panel with India’s finance ministry revealed high ranking officials were considering a national cryptocurrency, although not every official agreed such a token would be a step forward for the country.
Per The Hindu Business the founder of crypto exchange Belfrics, Praveen Kumar, noted that it’s too early for the RBI to “launch [a]crypto-rupee” as more understanding of the cryptocurrency economy is required. Waiting to see how it evolves, he said, is the “right decision.”
Kunal Nadwani, the CEO of uTrade Solutions, claimed government throughout the world will “launch fiat cryptocurrencies, whether out of compulsion or choice,” adding that the ability to tax their citizens in whichever token they choose lets them create fiat-currency based cryptos. Per his words, however, “it will take time before central banks are able to make this transition.”
Notably, local media have also recently reported that an interdisciplinary committee set up by the Indian government is looking into regulating and legalizing cryptocurrencies in the country, although with tough terms and conditions.
Last year, India’s RBI notably used a circular that ordered commercial banks to stop dealing with cryptocurrency-related firms. The move, as CryptoGlobe covered, saw one of India’s largest exchanges by trading volume, Zebpay, shut down.
At the time the crypto community fought back, and saw a missive from the country’s supreme court uphold the RBI’s decision. In late October, the supreme court even asked the government to clarify its stance on cryptocurrencies.