According to a report, India’s central bank, the Reserve Bank of India (RBI), has established a specialised fintech department that would help design regulations for cryptocurrency and the country’s planned central bank digital currency (CBDC).
The bank is working on two types of CBDCs, wholesale and retail, and the new department will be in charge of managing their development. Ajay Kumar Choudhary, the RBI’s current chief general manager, will be incharge of the department.
To be sure, the department is meant to oversee “new age challenges” deriving from fintech applications, and crypto is only a part of its brief, which indicates that while the department will supervise cryptocurrencies and their challenges, it may not necessarily be first on its plan.
The Reserve Bank of India (RBI), particularly its governor Shaktikanta Das, has been a strong opponent of Bitcoin in India. On several occasions, Das has warned against the use of cryptocurrencies in India and expressed concern about the growing amount of money invested in crypto-trading in the country.
While there is no precise estimate of the total number of crypto traders and users in India, the country’s top crypto exchanges claim to have millions of members.
In the fourth quarter of CY2021, Nischal Shetty, the creator of WazirX, the country’s largest crypto exchange by trading volumes, reported that the country had a total of 20 million crypto users.
For the better part of a year, India has been drafting legislation to govern cryptocurrencies. The measure in question was first placed on the agenda for the Parliament’s budget session in January 2021; however it was not introduced during that session. Finance Minister Nirmala Sitharaman and other ministers have hinted at what the bill would contain, and it was also on the agenda of the Parliament’s recently finished Winter Session.
The RBI’s decision might be excellent news for the industry, which has been requesting crypto regulations for a long time.