Shaktikanta Das, RBI governor, often attached negative sentiment to crypto assets; recently, he attacked digital currency again. According to him, these digital assets are real threats to a country’s financial stability. He further said an asset which generates no real value is speculation camouflaged in a sophisticated name. In the FSR or financial stability report, Das revealed that although technical revolution helps the financial sector achieve feats, crypto is questioning financial stability.
Undermining the RBI governor’s opinion
Lately, the global crypto market underwent a dramatic plunge, and even the most stable crypto-like bitcoin faced the jolt. In an interview with a local news channel, India’s Reserve bank governor took a strict regulatory stance against crypto and called it harmful for small investors. This is perhaps the second time Das made a negative remark about digital assets; earlier, he called it a “clear danger”.
He firmly believes that crypto might act as a stumbling block to the country’s stable financial growth as far as India’s economy is concerned. Per the governor; crypto is best suited for developed economies like the US and not India. The impact of cryptocurrencies on the exchange rate has the power to affect stability in centralized financial assets grimly.
His statements indicate that the centre’s concern about the rising illegal use of digital currency might prove threatful to investors.
Center’s regulation and crypto
Cryptocurrency can be called a perfect union of technology, assets and currency. The principal allegation digital assets often receive is their volatility and use in illegal activities. If we look back in history, economies, especially the Indian economy, faced issues with any private currency. Cryptocurrencies seem harmful to developing economies because they weaken the management of exchange rates.
Centralized capital sovereignty faces a crash when digital currencies find a place in payment systems. Not just in India, but governments across the globe have imposed regulations on crypto’s use well; they don’t deny technology’s role in developing financial assets.
Many countries plan to create their own currency, CBDC, to help combat an investor’s risk. Hopefully, people should learn to use cryptocurrency correctly and never treat digital currency as a gambling option.