RBI discusses crypto, digital currency
The central board of the Reserve Bank of India (RBI) on Friday discussed various aspects relating to the central bank digital currency and private cryptocurrencies, it said in a statement.
The 592nd meeting of the central board of directors was held at Lucknow, chaired by governor Shaktikanta Das.
While RBI has been working towards a phased implementation strategy for a central bank digital currency (CBDC), it has, on several occasions, expressed reservations with private crypto currencies. Last month, Das reiterated that cryptocurrencies are a very serious concern from the point of view of macro-economic and financial stability.
A central bank digital currency is a sovereign currency in an electronic form and would appear as liability (currency in circulation) on a central bank’s balance sheet. A 2021 survey by the Bank for International Settlements (BIS) found that 86% of central banks were actively researching the potential for CBDCs, 60% were experimenting with the technology and 14% were deploying pilot projects.
Finance minister Nirmala Sitharaman recently told the Lok Sabha that there is no proposal to recognize Bitcoin as a currency, PTI reported on November 29. In a separate reply, minister of state for finance Pankaj Chaudhary said that the government has received a proposal from RBI in October to amend to the Reserve Bank of India Act, 1934 and enhance the scope of the definition of ‘bank note’ to include currency in digital form.
Meanwhile, the statement on Friday also said that the board reviewed the current domestic and global economic situation, evolving challenges and remedial measures.
“The board also reviewed half yearly income statement of the Reserve Bank of India for the half-year ended September 30, 2021. The board also discussed various areas of operations of the Reserve Bank including the functioning of the local boards, activities of select central office departments and the draft Report on Trend and Progress of Banking in India, 2020-21,” it said.
Deputy governors Mahesh Kumar Jain, Michael Debabrata Patra, M. Rajeshwar Rao, T. Rabi Sankar and other directors of the central board – Satish K. Marathe, S. Gurumurthy, Revathy Iyer and Sachin Chaturvedi attended the meeting. It added that Debasish Panda, secretary, department of financial services also attended the meeting.