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RBI Deputy Governor Dismisses Crypto as Money, Warns Stablecoins Threaten Monetary Stability

India signals a cautious path that favors a sovereign CBDC over dollar‑pegged tokens, with a possible trading ban under consideration.

Overview

  • T Rabi Sankar said private cryptocurrencies lack intrinsic value, calling them just code rather than money or financial assets.
  • He argued stablecoins fail core attributes of modern money and pose risks including currency substitution, weaker policy transmission, and strains on banks.
  • The remarks highlight a policy divergence from recent U.S. moves that legitimised dollar‑pegged stablecoins, a market reported above $300 billion.
  • Sankar promoted central bank digital currencies as a superior alternative, noting India’s retail and wholesale pilots with roughly seven million users.
  • India maintains heavy taxation and AML registration for crypto activity, while a decision on prohibiting trading remains under review after stakeholder consultations.