Reserve Bank of India Governor Criticizes Cryptocurrencies

• Das stressed that cryptocurrency is “nothing but 100 percent speculation.”
• The RBI Governor was speaking at a Business Today event.

When it comes to Bitcoin and other digital currencies, the Reserve Bank of India (RBI) has issued a strong warning. Governor of the Reserve Bank of India Shaktikanta Das said, in light of the FTX disaster, that such illiquid instruments “are nothing but gambling” and that their apparent value is based solely on “make-believe.”

Das, speaking at a Business Today event, lobbed many criticisms against cryptocurrencies, insisting that all assets and financial products must have intrinsic worth. According to Das, cryptocurrency manias are similar to the tulip manias of the early twentieth century, with no actual value behind them. He stressed that cryptocurrency is “nothing but 100 percent speculation.”

Struggling With Unpredictability

Das voiced alarm about the growing digitization of payments and the potential threat presented by tech firms’ monopolization of payment networks.

As most cryptocurrencies are priced in US dollars, he warned that this might lead to the “dollarization” of the economy, which would be disastrous for countries that place a premium on maintaining tight control of their own currency’ value.

Therefore, he advocated for a total ban on cryptocurrency rather than incorrectly labeling it as a genuine financial instrument.

According to previous reports, in November 2021, when the cryptocurrency boom was at its peak, Das voiced grave worries about the possible effects of cryptocurrencies on India’s financial stability. Whether or if this comment from Das will lead to a shift in policy is still up in the air. In any case, the future looks interesting for India’s cryptocurrency sector, which continues to struggle with unpredictability.