The Indian government has informed parliament that it has no plans to issue a cryptocurrency that will be regulated by the Reserve Bank of India (RBI). The government also clarified that India’s central bank digital currency (CBDC), which will be launched this fiscal year by the Reserve Bank of India (RBI), is “a digital version of traditional paper currency”.
No RBI-controlled Crypto On The Anvil: Indian Finance Ministry
The Indian Ministry of Finance responded to queries about “RBI Cryptocurrency” in the Rajya Sabha, the upper house of parliament, on Tuesday.
Sanjay Singh, a Rajya Sabha member, questioned the finance minister “if it is true that the government is going to create a cryptocurrency to controlled by the Reserve Bank of India (RBI)?” “No sir,” said Pankaj Chaudhary, a minister of state in the finance ministry.
Singh went on to ask if the administration is aware that cryptocurrencies are “unregulated and unaffected by government action”. Minister Chaudhary responded: In India, cryptocurrencies are currently uncontrolled.
Meanwhile, the Indian government is actively drafting legislation on cryptocurrencies. A cryptocurrency measure was scheduled to be tabled in parliament during the winter session, however, it was not taken up. According to sources, the government is presently consulting widely on crypto-asset regulation and will require additional time owing to the issue’s intricacy.
Singh then went on to question Chaudhary about the digital rupee that the RBI is developing and planning to release this fiscal year: “How does the RBI cryptocurrency differ from the ordinary paper currency?”
Chaudhary said: The Reserve Bank of India does not issue a cryptocurrency. Traditional paper money is legal tender, and RBI issues it in accordance with the RBI Act of 1994. Central bank digital money is a digital replica of traditional paper currency (CBDC).
“The introduction of a central bank digital currency will give a big boost to the digital economy,” Indian Finance Minister Nirmala Sitharaman had said during her February 1 budget speech. “In addition, the digital currency will result in a more efficient and cost-effective currency management system.”
“The digital rupee will transform the fintech industry by offering new opportunities and reducing the strain in handling, printing and logistical management of currency,” Indian Prime Minister Narendra Modi stated regarding the planned digital rupee debut.