The deputy governor of India’s central bank has revealed the authority is working on a regulatory policy for cryptocurrencies like bitcoin in the country.
According to Indian business daily Economic Times, Reserve Bank of India (RBI) deputy governor NS Vishwanathan was speaking at an event in the city of Kolkata when he was asked if the RBI would encourage cryptocurrency adoption in India. While holding details close to the vest, the central banker confirmed the authority’s effort to introduce a clear regulatory policy in a country where bitcoin deemed neither legal nor illegal.
I can’t comment on a policy which is still in the making.
One of the world’s fastest-growing economies, India has seen a surge in both awareness and adoption of cryptocurrencies – particularly since the controversial demonetization initiative in November 2016 which effectively saw 86% of the country’s physical banknotes rendered obsolete overnight. Earlier in August this year, Indian finance minister Arun Jaitley – the highest financial official in the country – admitted that India’s bitcoin market had shown “notable growth” in a session of the Indian Parliament.
Despite cautioning adopters and investors against using bitcoin earlier this year, the RBI is now part of an inter-governmental committee established by India’s Ministry of Finance to study, research and propose a framework for digital currencies in India. Formed in April, the committee soon opened itself to citizens for comments and suggestions about regulation and the legality of virtual currencies.
The government’s “Cashless India” initiative has also led to the RBI researching fiat cryptocurrencies to develop a digitized version of the rupee, India’s fiat currency.
While Indian authorities deliberate over a cryptocurrency policy, FinTech startup Ripple has expanded its operations with a newly opened office in India last month. Ripple’s XRP, the native token that powers the bank-friendly enterprise-ready blockchain Ripple Consensus Ledger (RCL), is the world’s third largest cryptocurrency with a market cap of over $10 billion.