• India’s Central Bank Governor, Shaktikanta Das, warns about the risks cryptocurrencies pose to the financial system.
• The RBI Governor emphasizes that the worst of inflation is behind us and Indian economy remains resilient.
• Das has repeatedly warned about crypto risks and believes it undermines the RBI’s capacity to regulate the country’s monetary system.
RBI Governor Warns About Crypto Risks
The governor of India’s central bank, the Reserve Bank of India (RBI), has warned about the risks cryptocurrencies pose to the financial system while commenting on recent U.S. banking turmoil at a lecture on Friday. RBI Governor Shaktikanta Das said: Ongoing U.S. banking crisis drives home the importance of robust regulators, sustainable growth and clearly shows risks of private cryptocurrencies to the financial system.
Indian Economy Remains Resilient
Das stressed that the U.S banking crisis demonstrates „the need for prudent asset liability management“ while emphasizing that „the worst of inflation is behind us“ and that „the Indian economy remains resilient.“
Crypto Threatens Monetary System Regulation
According to Das, cryptocurrency not only poses a significant threat to India’s macroeconomic and financial stability but also seriously undermines the RBI’s capacity to determine monetary policy and regulate its monetary system.
U.S Banking Crisis Demonstrates Crypto Risks
The governor added that recent collapses in several banks in the U.S., such as Signature Bank, Silicon Valley Bank, and Silvergate Bank demonstrate „the risks of private cryptocurrencies to the financial system.“ Some believe these regulatory actions are related to cryptocurrency but regulators have insisted they are unrelated to crypto exchanges or businesses accepting digital currencies as payment methods.
Conclusion
In conclusion, RBI Governor Shaktikanta Das‘ warnings demonstrate that there are potential risks associated with cryptocurrency which could undermine India’s macroeconomic security if not monitored properly by regulators and policymakers alike.