India’s RBI deputy governor to IMF

Speaking to the International Monetary Fund (IMF), T Rabi Sankar, the deputy governor of the Reserve Bank of India (RBI), reflected an anti-crypto stance when he spoke about India’s potential to transform the crypto and blockchain ecosystem. to disturb.

Rabi Sankar kicked off the conversation by pointing to the success of the Unified Payments Interface (UPI), India’s in-house fiat-based peer-to-peer payment system — which has seen average adoption and transaction growth of 160% per year for the past few years. to see. five years.

“One of the reasons it’s so successful is because it’s simple,” he added, comparing UPI’s growth to blockchain technology. According to Rabi Sankar:

“Blockchain, which was introduced six to eight years before UPI started, is called a potentially revolutionary technology even today. [Blockchain] use cases have not yet really developed at the speed initially hoped for.”

However, the RBI official confirmed that a large population in India is still unable to access UPI-based banking due to the unavailability of smartphones. To counter this, the Indian government is working on offline payment platforms, some of which have been rolled out to the masses.

Rabi Sankar also stated that banks will remain crucial in providing liquidity services to the general public in India, warning that technology is only a tool and cannot be used to create currencies:

“A currency needs an issuer or needs intrinsic value. Many cryptocurrencies that are neither are still accepted at face value. Not only by gullible investors, but also by experts, policymakers or academics.”

He further stated that RBI does not believe that stablecoins, such as Tether (USDT), should be blindly accepted as 1-to-1 fiat pegged currencies. Talking about the benefits of a digital rupee, Rabi Sankar said:

“We believe that central bank digital currencies (CBDCs) could be able to kill every little case that could be for private cryptocurrencies.”

Related: India to roll out CBDC using a graduated approach: RBI Annual Report

On May 28, India’s central bank, RBI, proposed a three-step approach to roll out CBDC “with little or no disruption” in the traditional financial system.

As Cointelegraph reported, Finance Minister Nirmala Sitharaman first unveiled plans to launch a CBDC in 2022-23 with the aim of giving a “big boost” to the digital economy. The RBI report found that the central bank is currently experimenting to develop a CBDC that addresses a wide variety of issues within the traditional system.