Amid all the frenzy currently going around India’s crypto ban, we have a fresh update from the deputy governor of the Indian central bank. B.P. Kanungo, the deputy governor of the Reserve Bank of India said that the central bank is closely following the development model for the central bank digital currency (CBDC).
The RBI is currently following up with how major economies worldwide and their respective central banks are working around the CBDC projects. The deputy governor added that the central bank will soon come out with its decision on its intent around an official digital currency. The Indian government and central banks have been more or less skeptical of private cryptocurrencies like Bitcoin.
The deputy governor of RBI stated that the monetary policy committee has been working around digital currency for quite some time. He added:
“We had a committee that is still on the drawing board. In fact, an internal committee is taking a close look to decide on the model of the central bank digital currency and you will hear from the Reserve Bank very soon in the matter”.
India’s Flip-Flop With Cryptocurrencies, But Investors Show Interest
Crypto developments in India have been going at a pretty slow rate over the last few years. Back in 2018, the Reserve Bank of India (RBI) banned all nationalized banks from doing business with crypto exchange. Well, it led to a massive liquidity crunch leaving a massive dip in the investor base. Many crypto exchanges were forced to go out out of business.
However, since the decision for crypto usage was on a hiatus for a long, the Supreme Court of India passed a ruling lifting RBI’s ban. A fresh wave on Indian investors has struck back and the retail interest has been picking up fast. Also, there seems to be some optimism around the announcement of a central bank digital currency. As reported by local news publication Financial Express, last Friday, Governor Shaktikanta Das said:
“With regard to digital currency, I think we have already released our document. Our digital payment document spells out that digital currency is work in progress in RBI”.