The Indian government board is drafting crypto regulations. If cryptocurrencies are accepted as means of payments they could destabilize the rupee. This concern came to light even though there is no proof that cryptocurrencies pose any threat to financial stability at present. The Indian Government worried cryptocurrencies undermine rupee. Subhash Chandra Garg, Secretary of the Department of Economic Affairs, will head the committee.
“If bitcoin and other digital currencies are allowed to use for payments then whether it will end up destabilizing the fiat currency is a major concern. The overall impact on the financial ecosystem that it is likely to have is still unclear and it has been a challenge to convince them on this particular point.”
–For Garg’s panel, the publication quoted
Right now, Garg’s panel is settling its report which contains the proposals for the nation’s crypto regulation, according to the government’s reply to a Right to Information filing.
However, the Ministry of Finance revealed to Parliament that “It is hard to express a particular course of events to come up with clear suggestions” and that Garg’s board is “seeking after the issue with the due alert.”
The Financial Stability Board (FSB) published a report in October on the financial related stability ramifications of crypto resources. The FSB is a worldwide body that screens and makes suggestions about the worldwide financial framework to the G20. G20 is a universal gathering for governments and national bank governors.
All members of it are financial regulators and central bankers from 24 nations, as well as from worldwide associations such as the International Monetary Fund. Cryptocurrencies require steady checking on overall financial stability considerations, given the quick extension in their utilization.
“Based on the available information, crypto assets do not pose a material risk to global financial stability at this time. Vigilant monitoring is needed in light of the speed of market developments. Should the use of crypto-assets continue to evolve, it could have implications for financial stability in the future.”
-The FSB report states
“The market continues to evolve rapidly. However, this initial assessment could change if crypto assets were to become more widely used. Also, interconnected with the core of the regulated financial system. Cryptocurrencies need constant monitoring on overall financial stability considerations, given the rapid expansion in their usage,”
– the Reserve Bank of India (RBI) detailed.