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Budget 2023: RBI Governor Urges Full Ban on Cryptocurrency Ahead of Union Budget 2023

The RBI GovernorShaktikanta Das shared his thoughts on the negative aspects of cryptocurrencies and the country’s growing demand at the Business Today Banking and Economy Summit last Thursday.

When discussing the role of cryptocurrencies in the Indian economy, Das said, “Cryptocurrency should be banned because it has no real market value. Every financial product, like every asset, has a underlying value, so the value of cryptocurrencies is entirely based on guesswork.

Das also pointed out the price volatility of cryptocurrencies, which makes her untrustworthy. “Price volatility is based on the fictional concept that the price of a particular cryptocurrency may rise or fall. So anything that is not underlined and whose ratings are based entirely on pretense is purely speculative or, to put it bluntly, gambling.”

While speaking at the event, Das continued, “Crypto is a form of gambling with no underlying value and is nothing more than a world of pure speculation.”

This is a worrying sign for the Indian crypto industry, especially since the annual report Union budget is only a few days away.

RBI’s intention to ban cryptocurrency

According to recent reports, it has been revealed that the RBI has an antagonistic sentiment towards crypto and sees it as an entity that can cause “financial instability”. Das highlighted the central bank’s stance on banning Bitcoin and Ethereum in the face of growing demand.

The governor said at the event, “RBI could likely fail in transaction monitoring if crypto is allowed in India.”

He continued, “Crypto masquerading as a financial asset is a completely misplaced argument. Das mentioned cryptocurrency as a form of gambling while stating that “Our country does not promote gambling, and if people want to continue investing in it, establish appropriate rules for it.”

On a larger scale, he asserted, “Cryptocurrencies have the potential to become a medium of exchange for carrying out a transaction. The majority is in dollars, and if allowed to grow, that means 20% of transactions are made using cryptocurrencies, which means they are not issued by central banks but rather by private companies of the whole world.

What more does the RBI Governor have to say?

The RBI Governor raised concerns about the currency’s future, which could be detrimental to the economy, while pointing to the latest FTX crash. “Dollarization would increase due to the growing use of crypto and could work against the sovereign interest of the country,” he said during his speech at the event.

Das focused on the topic of a cryptocurrency regulatory framework. As mentioned earlier, the government has been continuously working on a crypto bill for many years. A technology-driven regulatory framework for crypto assets was to be introduced at the G20 summit, according to Nirmala Sitharman, who spoke on the matter in October.

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