Overview
- India’s Financial Stability Report says widespread use of privately issued stablecoins poses significant risks to monetary sovereignty and financial stability.
- Foreign‑currency‑denominated tokens could erode monetary control by weakening domestic policy transmission, the report states.
- The RBI reiterates that central bank money must remain the ultimate settlement asset and urges countries to prioritise CBDCs over stablecoins.
- The report cites episodes such as the 2022 TerraUSD collapse and volatility during the 2023 U.S. banking turmoil as evidence of structural fragilities.
- Authorities warn of capital‑flow circumvention and AML/CFT abuses without robust rules, noting rapid issuance growth, new regulatory regimes in major jurisdictions, and a still modest share relative to the broader crypto market.