RBI Crypto Stance: Sanjay Malhotra Sounds Cautious on Crypto

Cryptocurrencies and Stablecoins are Risky Says RBI Crypto Stance

The Reserve Bank of India (RBI) has reiterated a cautious approach toward cryptocurrencies and stablecoins, warning investors about the risks associated with these digital assets. Presenting the RBI Crypto Stance, RBI Governor Sanjay Malhotra emphasized that while virtual innovations are welcome, private cryptos and stablecoins carry significant financial risk.

Source: TimesOfIndia

“Stablecoins, cryptos, they have a huge risk, and so we are adopting a very cautious approach towards it,” Governor Malhotra said during a memorial lecture at the Delhi School of Economics. This statement aligns with previous comments, highlighting country’s careful oversight of digital asset adoption.

RBI on Crypto and Stablecoins

While the RBI maintains caution over cryptocurrencies, it remains supportive of government-backed cloud innovations. The country recently announced its own ARC stablecoin launch in the first quarter of 2026, which supports digitalization of native currency – Rupee.

Malhotra noted that the country has successfully promoted online payments and lending platforms, such as UPI, demonstrating an enabling view for regulated fintech solutions.

The central bank also favors a Central Bank Digital Currency (CBDC) over private stablecoins or cryptocurrencies, reinforcing its goal to retain monetary stability. Governor Malhotra stated that the government will make the final decision on crypto's regulations, with a working group already reviewing potential policies.

India Crypto Growth and Market Trends

Globally, U.S. dollar-backed stablecoins now hold a market capitalization exceeding $300 billion, while the total cryptomarket has crossed $4 trillion. The nation's Chief Economic Adviser, V. Anantha Nageswaran, highlighted the rising popularity of stablecoins as a factor that could challenge global monetary policy next year.

For the consecutive times, the country has placed in #1 rank through many reports in crypto adoption, despite the fact that it lacks clear regulations. 

Along with that, cryptocurrency exchanges can still operate in the nation after local registration and compliance with anti-money laundering rules. However, punitive taxes on crypto-gains and repeated central bank warnings have created near-freeze conditions between the formal financial sector and cryptocurrencies.

India Digital Asset Adoption: Balancing Innovation and Risk

While the RBI is wary of private digital-assets, it continues to explore India stablecoin news and the broader potential of digital currency initiatives. Governor Malhotra’s remarks underline the importance of balancing the crypto growth with systemic safety.

India’s cautious but accommodative stance on virtual innovation aims to foster a regulated environment for blockchain technology while minimizing financial risks. This approach may shape the future of India cryptocurrency adoption and the use of virtual assets in mainstream finance.