Reserve Bank of India Pulls Back From Central Bank Issued Crypto

Reserve Bank of India Pulls Back From Central Bank Issued Crypto

A news report today by the Hindu BusinessLine revealed that the Reserve Bank of India has shelved its plan to issue a central bank digital currency.

Plans to issue a central bank digital currency was first declared in April of last year. The initial plans may have been driven by the burden of current rising costs in printing paper fiat money. However, it had set up an interdepartmental group to investigate the possibility of a central bank issued and controlled cryptocurrency. Reports were generated on the feasibility to that effect, however, findings have not been made public.

Around the same time, it had already put pressure on the development of cryptocurrency business in the country, cracking down on ICOs, exchanges and the ban on banking services for crypto-related transactions.

According to the news outlet, it quoted an undisclosed source saying “The government doesn’t want the digital currency anymore. It thinks it is too early to even think about a digital currency.” Moreover, they had not received any further response from the RBI about the matter.

The source further reports that the initial attempt to launch the digital currency was to check concerns over black money, money laundering, and cybersecurity threats. It would seem the findings may have expounded on such as the sudden retracting of their decision comes off as a surprise, seeing how some days ago, a report was released suggesting that the committee overseeing cryptocurrency was considering legalizing digital currencies – one would have thought it was a favorable premise to launch the rupee back cryptocurrency.

Further, the source also quoted the founder of cryptocurrency exchange and blockchain start-up Belfrics, Praveen Kumar saying: “It is premature for RBI to launch crypto-rupee, as more understanding of the crypto economy needs to be achieved. It is the right decision to delay the process and see how the publicly traded peer-to-peer economy is shaping up.” It is of the opinion that the crypto space in the country should be given more time to develop while watching how other smaller nations like the UAE and Singapore are adapting to the new technology.

Saudi Arabia had announced last year that its state-managed cryptocurrency will be launched in association with the United Arab Emirates (UAE) in 2019 as a solution for international payments.

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