Wednesday, June 19, 2024

RBI’s crypto ban talks give the shivers to small investors

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Mumbai: Tough talk by senior Reserve Bank of India (RBI) officials on cryptocurrencies is making the Indian crypto community nervous.

On Monday, RBI deputy governor T Rabi Sankar called for an outright ban on cryptocurrencies.

Previously, RBI governor Shaktikanta Das had said in a monetary policy press conference that private cryptocurrencies were a threat to the macroeconomic and financial stability of the country, and investors should keep risks in mind as such assets have no underlying value whatsoever, “not even a tulip”.

The recent statements have added to the worries of Indian crypto investors, who were already reeling from the tax rules for digital assets announced in the budget, losses in the past two months, rising Russia-Ukraine border tensions, the US Fed’s hawkish stance, and a meltdown in technology stocks (which have a high correlation with crypto).

“The government is sending out a lot of conflicting signals. On the one hand, the FM has said that they want to foster innovation in blockchain in India, and on the other hand, the RBI officials are talking about a ban, “said Vishal Gupta, a Noida-based investor.

Speaking at the 17th Annual Banking Technology Conference and Awards of the Indian Banks’ Association, RBI’s Sankar said that cryptocurrencies could wreck the currency system, the monetary authority, the banking system, and the government’s ability to control the economy. “All these factors lead to the conclusion that banning cryptocurrency is perhaps the most advisable choice available to India,” he said.

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Also read: Parliamentary committee to meet crypto industry players today

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