RBI Says a Big No To Bitcoins In India; But Open To Use Blockchain In Future!
RBI has once again made its stand very clear on the issue of cryptocurrencies like bitcoins.
Reserve Bank of India has once again made its stand very clear on the issue of crypto currencies like bitcoins; but there is a twist here.
As per recent comments coming in, it seems RBI is open to use blockchain, which is the technology powering several cryptocurrencies such as bitcoins. However, when it comes to usage of bitcoins, then the answer is big no.
Bitcoins, A Big No!
During a banking event, someone from the audience asked S Ganesh Kumar, Executive Director of RBI with a question regarding usage of bitcoins in India.
In reply, he said,
“Our current position on bitcoins is that we will not be using it for any payments and settlements…though the technology underlying cryptocurrencies will not end.”
RBI’s stand on bitcoins by is same as before: In February this year, RBI had actually ‘warned’ Indians against using them, and had said that its usage carries substantial financial and legal risks.
In March, exactly a month later, RBI threatened to invoke anti-money laundering laws and anti-terrorism laws against anyone found trading bitcoins in India. It seemed that this was the end of crypto currencies in the country.
And the threat seems real, when cases of bitcoins being used for purchasing drugs pop-up; questioning about the need for regulations.
In fact, Govt. is even considering closure of cryptocurrency dealers in India.
However, there is still a silver lining here – It seems Govt. may launch their own version of cryptocurrency, very soon.
RBI’s Own CryptoCurrency?
In September, indications were given out that RBI launch their own fiat digital currency, using blockchain technology.
Fiat money is currency that a government has declared to be legal tender, but it is not backed by a physical commodity.
Sudarshan Sen, RBI Executive Director, had said,
“Right now, we have a group of people who are looking at fiat cryptocurrencies. Something that is an alternative to the Indian rupee, so to speak. We are looking at that closely.”
If this happens, then usage of cryptocurrency in India will be regulated, and monitored, and this will encourage its more usage.
China has already declared that they aim to eliminate physical currency completely, and launch their own version of crypto currency, for the new digital age.
We will keep you updated, as the fascinating story of crypto currencies in India becomes even more interesting.