RBI Deputy Governor touts CBDC

The Deputy Governor of the Reserve Bank of India says a CBDC can be anonymous and that any crypto data is misleading.

The ongoing debate between the use of cryptocurrencies and central bank digital currencies (CBDCs) has prompted the RBI Deputy Governor Rabi Patra to enter the fray with a few words of caution. 

Misleading crypto data

In a recent statement, RBI Deputy Governor Patra has said that whatever data is available on cryptocurrency is misleading. Patra’s comments came during an online event organised by the Reserve Bank of India (RBI). 

During the event, Patra noted that untrustworthy crypto data could be a result of the lack of proper regulation and guidelines in place for its use. Patra went on to explain why the data available on cryptocurrency is so misleading, making it difficult to make a proper assessment of the risks and benefits associated with each cryptocurrency. 

Insufficient regulations and lack of transparency

Furthermore, Patra noted that the absence of proper regulations and guidelines could lead to fraudulent activities that could potentially lead to huge losses. He pointed out that such activities could be conducted with impunity, as the lack of rules and guidelines make it difficult to trace or prosecute the perpetrators. 

In addition to this, Patra also raised concerns about the lack of transparency in the cryptocurrency market. He said that this could lead to manipulation and other unethical practices. He urged all stakeholders involved in the cryptocurrency market to ensure that the market is made more transparent.

Indian crypto regulation

Patra’s comments come at a time when the Indian government is looking to introduce its own regulations for the use of cryptocurrency. The RBI has already imposed a ban on banks and financial institutions from dealing in cryptocurrency, but the government is yet to introduce any comprehensive regulations for its use. 

The e-rupee

The RBI is also looking to trial and issue its own central bank digital currency (CBDC) in the form of the e-rupee. It states that it will be as anonymous as the rupee in circulation today and will not need any intermediaries.

Opinion

That the Deputy Governor of the Reserve Bank of India is saying that crypto data is misleading is rather misleading in itself. Anyone educated in how cryptocurrencies work would know that they are based on blockchain technology which means that every single transaction can be tracked. 

Governments and banks are involved in a war against cryptocurrencies which they need to win in order for CBDCs to be adopted without any competition from private assets. The comment that CBDCs will be “anonymous” is also highly debatable. Most experts have already said that this technology can give ultimate power to central banks to intervene in any individual’s account and sanction them in any way they choose.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.