Reserve Bank of India Establishes Department to Oversee Cryptocurrency Exchanges and Develop CBDCs

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Key Takeaways:

  • Reserve Bank of India establishes department to oversee cryptocurrency exchanges and develop CBDCs.
  • According to reports, India would create two CBDCs, one for wholesale and one for retail.
Reserve Bank Of India Establishes Department To Oversee Cryptocurrency Exchanges And Develop Cbdcs
Reserve Bank of India Establishes Department to Oversee Cryptocurrency Exchanges and Develop CBDCs

According to a Coindesk report, India’s central bank, the Reserve Bank of India (RBI), has established a specialised fintech department to develop cryptocurrency legislation and the country’s proposed central bank digital currency (CBDC).

According to the article, the bank is working on two types of CBDCs: wholesale and retail, and the new department will be in charge of overseeing their development. Ajay Kumar Choudhary, the RBI’s current chief general manager, will charge the department.

The department’s mandate is to oversee “new age challenges” arising from fintech applications, and crypto is only a tiny part of that mandate. This means that while cryptocurrencies and their challenges will be overseen, they may not be first on the department’s agenda.

In India, the Reserve Bank of India (RBI), namely its governor Shaktikanta Das, has been a vocal opponent of Bitcoin. Das has warned against the usage of cryptocurrencies in India on multiple occasions and expressed alarm about the growing amount of money involved in cryptocurrency trading in the country.

While there is no exact figure for the overall number of cryptocurrency dealers and users in India, the country’s leading crypto exchanges claim to have millions of users.

India has been working on laws to regulate cryptocurrency for the better part of a year. The bill in question was initially placed on the Parliament’s budget session agenda in January 2021. However, it was never introduced during that session. However, the bill’s contents have been hinted at by Finance Minister Nirmala Sitharaman and other ministers, and it was also on the agenda of the Parliament’s recently concluded Winter Session.

The RBI’s decision could be great news for the crypto industry, which has been clamouring for restrictions for quite some time.

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Chetna Prakash