Reserve Bank of India says central bank digital currencies will ‘kill’ cryptocurrency

T Rabi Sankar, Deputy Governor of the Reserve Bank of India (RBI), said central bank digital currencies (CBDCs) can “kill” so-called private cryptocurrencies or virtual digital assets (VDAs).

CBDC vs Cryptocurrency

Many countries are working on their own digital currency, called CBDC. In fact, the technology behind these currencies is very attractive to many central banks who see these new forms of money as an alternative to cash and bank transfers. Iran, for example, is working on its own digital riyal.

During a seminar organized by the International Monetary Fund, Deputy Governor of the Reserve Bank of India (RBI) to express his opinion on the future of cryptocurrencies and digital currencies for the central bank. “We believe that digital central bank currencies may actually be able to eliminate any disregard for private cryptocurrencies,” he said, according to India’s The Economic Times. India is working closely with the International Monetary Fund on these crypto-related issues.

India is particularly well known for its complicated stance on cryptocurrencies, having repeatedly left doubts that they will be banned. They are currently taxable only. But as the CEO of CoinSwitch India points out, a clear and specific regulation on cryptocurrency is necessary.

Different opinions about the future of cryptocurrency

Unlike most opponents, Anshul Dhir, co-founder and COO of EasyFi Network, believes that central banks and cryptocurrencies will only complement each other rather than compete with each other.

Vikram Subraj, CEO of Giottus, expressed a similar view. He claims that central bank digital currencies will not kill other cryptocurrencies, which appear to be on the RBI’s wish list. ” They don’t see countless innovations happening in this field “.

In fact, cryptocurrencies are just the number one tool for using Web 3.0. Hundreds and hundreds of uses arise from these cryptocurrencies and the highly interconnected world of Metaverses is changing thanks to the many innovations that cryptocurrencies bring.

CBDC

The stablecoins at the center of the debate

After the last collapse of stablecoin Terra, regulators have boosted their interest in these supposedly stable coins. In this context, the CBD can dethrone stablecoins. However, even if Tiera’s condition is especially serious, there are many stablecoins Enhance their collateral.

As cryptocurrency advocates for stablecoins Related to regulated currencies, Mr. Sankar said that “ undisputed acceptance ” It seems ” worrying He insisted on the fact that one must understand the difference between money and currency, and that private money is widely present in the system.

According to market participants, digital central bank coins can be a good and real alternative to this class of cryptocurrency, if implemented well.

Stablecoins contribute to capital flow and ease of transactions in the crypto ecosystemSubraj said. ” They are only part of the utility that the blockchain represents “.

In fact, the stablecoins remain necessary for the current operation of Web 3.0. However, it is possible that the new stablecoins More efficient or more transparent is emerging in order to continue finding solutions without going through CBDCs.

India therefore remains in an outright hostile attitude towards cryptocurrencies, as the adoption of the latter is increasingly high in the country. In-depth work between Web 3.0 stakeholders and regulators will be necessary to find a compromise so as not to hamper innovation while protecting investors and users as much as possible.

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Alexis Patten

Passionate about geopolitics, economics, cryptocurrency, Eurasia and travel! (as far east as possible), cryptocurrency trader for 4 years.

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