T.B Rabi said that private cryptocurrencies pose a risk to the Indian investing ecosystem and RBI is working towards reducing the reliance of Indian users on private tokens.
Deputy Governor RBI said that there are potentially game-changing choices available, particularly in the area of cross-border transactions
Interactions has said that Indian CBDCs would be able to do everything that any other private cryptocurrency can do
T.B Rabi Sankar while addressing an event by the Indian Banks’ Association talked about the future of cryptocurrencies and the ongoing CBDCs’ retail trials within the country. T.B Rabi said that private cryptocurrencies pose a risk to the Indian investing ecosystem and RBI is working towards reducing the reliance of Indian users on private tokens.
Sankar said, “If there is anything that a private cryptocurrency can do, we should be able to create a product that will do that without the associated risks in a safer format in fiat money backed by the government and issued by the central bank. This is essentially what we are doing in the CBDC experiments.”
India has recently started the pilot phase of its Retail Central Bank Digital Currencies after the successful trials of its wholesale CBDCs. The Reserve Bank of India is cooperating with national banks to ensure that a safe and efficient deployment of CBDCs would be possible after the trials. The test runs for the retail CBDCs are going on in four Indian cities namely, Bengaluru, Delhi, Mumbai, and Bhubneshwar.
As per the opinion of RBI’s Deputy Governor, Indian CBDCs would be open to improvements and further developments to ensure that users would not have to go for unreliable centralized players for getting their transactions done. There is no doubt about the fact that Indian CBDCs would reduce the flow of USDT and other stablecoins as the e-Rupee would be a more efficient and reliable alternative to them.
“There are potentially game-changing choices available, particularly in the area of cross-border transactions. There are a huge amount of inefficiencies in this process that the CBDC can take care of.”, added Sankar.
Even though the RBI Deputy was sure that Indian CBDCs would be able to replace Bitcoin and other altcoins, the cryptocurrencies in India are not going anywhere. The scope for Indian CBDCs is great and the crypto community across the globe is appreciating the RBI's attempts of deploying the e-Rupee, however, the cryptocurrencies and blockchain networks cannot and will not be banned in India. The future belongs to a diverse financial ecosystem and India is going to lead the markets with examples.