Reports Say Reserve Bank of India (RBI) is Postponing Plans for a National Cryptocurrency
According to the Indian news outlet the Hindu Business Line, the Reserve Bank of India (RBI) is pausing its plans to create a national cryptocurrency. Back in 2018, the central bank of India announced that it was analyzing the possibility of launching a central bank digital currency (CBDC).
At that time, the bank created a group that analysed the feasibility and advantages related to a CBDC. In August, the RBI confirmed that they created that group and that this CBDC would be backed by Indian rupee.
However, due to unknown reasons, the central bank of the country decided to pause the project, at least for some time. It seems that the report conducted by the institution did not provide positive feedback about the future potentialities of a CBDC in the Indian economy.
Hindu Business Line quoted a source as saying:
“The government doesn’t want the digital currency any more. It thinks it is too early to even think about a digital currency.”
The government is also trying to reduce cash usage in the country. At the same time, the government has also attacked transactions to consumers’ biometric data using the Aadhaar scheme, one of the biggest biometric ID systems.
India has been taking hard stances towards virtual currencies in the country. Several cryptocurrency exchanges had to shut down their operations and other companies had to leave the country.
There are many other countries that are starting to evaluate the possibility to launch a Central Bank Digital Currency. Some of those investigating the potentialities of launching a CBDC are Canada, the United Kingdom, Sweden or Norway. Nevertheless, none of them has already launched any CBDC.
Another country that is also investigating the feasibility of issuing a national cryptocurrency is Ukraine. The main intention is to create an electronic version of the Hryvnia.
A few weeks ago, rumors spread about Facebook launching a stablecoin for the WhatsApp messaging app and that would be tested in India. Apparently, the intention is to see how it can enhance India’s remittance industry that plays an important role in the country’s economy.