India’s central bank has been moving to basically ban cryptocurrencies this year – but it’s now revealed it has potential plans for a national one…
Most headlines over the past year, where India and cryptocurrency are concerned, have centered on the clampdown that’s been instigated by the Reserve Bank Of India. The RBI, back in June, implemented its effective ban on cryptocurrency in the country. Its ruling meant that nobody would be able to invest or withdraw money from digital assets in India from June 5th, and added that entities who deal with the RBI would be prohibited from dealing with, or settling, virtual currencies.
This, though, led to some immediate backlash, and criticism from across the cryptocurrency community. Furthermore, the effective ban is all set to go back to court on September 11th 2018, as per this report.
However, speculation had been rife as to what the RBI’s motivation was in what appeared on the surface to be such a draconian crackdown. It turns out that it may have been paving the way to launch a digital currency of its own.
The RBI has published its annual report, and it specifically talks within it about “the need to explore a digital currency for the country”, in response to what it describes as “the emergence of private digital tokens and the rising costs of managing fiat paper/metallic money”.
As such the RBI has now announced that “An inter-departmental group has been constituted by the Reserve Bank to study and provide guidance on the desirability and feasibility to introduce a central bank digital currency”.
The RBI ruling on everyone else’s cryptocurrencies remains in the offing. How that impacts the bank’s own plans remains to be seen. Timescales for the RBI’s work into its own currency haven’t been announced.