Duvvuri Subbarao, the former governor of the Reserve Bank of India (RBI), has highlighted his concerns about cryptocurrencies at a time when India is trying to regulate the crypto market. Subbarao is concerned that if cryptocurrencies are legalized, they will deprive the central bank of authority over the country’s money supply and inflation management. Subbarao made his opinion at a webinar hosted by the National Stock Exchange (NSE) and the Stern School of Business at New York University (NYU) this week.
“There are also fears that crypto would disturb monetary policy,” according to the former RBI chief, who served from 2008 to 2013.
Despite India’s plans to develop a national central bank digital currency (CBDC), Subbarao feels the project might backfire owing to the country’s lack of adequate data protection legislation.
Furthermore, Subbarao stated that the central bank’s function as a lender of last resort should not be affected by the legalization of cryptocurrencies in India.
The news comes as India’s intention to prohibit any private cryptocurrencies from functioning in the nation was put on the agenda of the Parliament’s ongoing winter session last month.
In addition, the new legislation intends to make people who break the law susceptible to being arrested without a warrant, imprisoned without bail, and subject to severe fines.
After receiving Cabinet approval, the bill will be presented to the Indian parliament.
According to many surveys conducted by research businesses such as Statista, Hootsuite, and TripleA, India has over 100 million cryptocurrency users.
Not only in India but also in other areas of the world, the crypto sector has seen widespread acceptance and adoption.
“Cryptocurrencies have become too enormous to ignore,” according to research issued by Bank of America in October.
According to BofA’s study, crypto mergers and acquisitions increased from $940 million (approximately Rs. 7,025 crores) in 2020 to $4.2 billion (about Rs. 31,390 crores) in 2021.
Tesla CEO Elon Musk stated earlier this month in a speech to governments across the world that while the progress of cryptocurrencies can be halted, these digital assets cannot be destroyed at this time.
However, numerous leaders, notably Russian President Vladimir Putin, are concerned about the excessive volatility in the cryptocurrency market.
- Untitled-design-105: https://newsroompost.com/