Indian Govt. Committee Expresses Worry on How Cryptos Can Impact National Fiat Currency Stability
India has a very rough relationship with cryptocurrencies. The country, which has enacted a ban on crypto exchanges last year, is now focused on deciding whether this ban, which is being called an exaggeration by the local crypto industry, should be lifted or not. Now, a committee debating the question is wondering whether crypto payments could affect the stability of the rupee.
The rupee (INR), as you may know, is the fiat currency of the country. According to some inside sources cited by Quartz, the committee set by the Indian Economic Affairs Secretary, Subhash Chandra Garg, is very concern about this impact.
According to the sources, the destabilizing impact of the currency is still unknown at this moment and some people are very afraid that the legalization of Bitcoin may bring unintended consequences for the industry.
Some of these concerns may have been created after the Bank of International Settlements (BIS) has affirmed, during March 2018, that the authorities should monitor cryptos outside of their centralized control and that even cryptos issued by banks could be bad for stability, which is what probably has led the government into having this anti-crypto stance.
Rahul Raj, the founder of Koinex, was interviewed by Quartz and defended the crypto industry. According to him, there is simply no reason to be so worried while cryptocurrencies are not as big as payment providers like Mastercard or Visa because not a lot of people will use them, so the government is basically overreacting.
Fears of The Committee Are Bad News For Crypto Investors
The fact that the committee, despite investigating the issue for so long, is so wary of cryptos, is very bad for the industry. If the committee continues with this vision, there is a chance that cryptos may be banned forever in India.
Last year, some reports surfaced indicating that the Reserve Bank of India (RBI) was considering to completely ban cryptos from India, which is possibly the worst ending for this situation.
However, last month, some people suggested that the government could, in fact, legalize cryptos in the country. The reports are fairly inaccurate at this point and nobody knows what will actually happen.
India has been debating about cryptos for almost a year. The debate started to get heated after April 2018 when the RBI affirmed that banks could not provide services for crypto companies, which was known as the crypto ban of India. Nobody knows what will happen, so we are all waiting to determine the next move from the Indian government in this industry.