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Published: Jan 13, 2023
Updated: Jan 13, 2023

RBI Governor Calls Cryptocurrency 'Poor Gambling': Urges Government to Restrict its Growth

The Reserve Bank of India (RBI) Governor, Shaktikanta Das, has once again spoken out against the use of cryptocurrency in the Indian economy. At an event in Mumbai on January 13th, he stated that crypto is a form of poor gambling and could undermine the power of the central bank if allowed to grow unchecked.

Crypto Without Substance

Governor Das argued that crypto assets are without any underlying assets and their valuation is dependent on make-believe, making them nothing but 100% speculation. He said, “The so-called crypto assets have the potential to become a means of exchange. If you allow it to grow, assuming 20% of transactions in the economy through crypto, which is not issued by the central bank, the RBI being the monetary authority will lose control over the money supply in the economy.”

RBI's Position on Crypto Remains stern and firm

The central bank has been warning against cryptocurrencies for a long time and has openly called for a ban. The Indian government is yet to take a decision on the legality of crypto assets in the country.

Das concluded, “To put it bluntly, crypto is gambling.”

The governor's remarks come at a time when the global crypto market is seeing a resurgence with Bitcoin reaching new highs, and institutional investors showing increasing interest in the asset class. However, it remains to be seen how the Indian government will approach the issue in the coming months

RBI may lose its monitoring  control if Crypto currencies trade continue

Governor Das also highlighted that if crypto is allowed in India, the RBI will lose control over monitoring transactions and the bank's ability to decide the liquidity that needs to be maintained will get undermined if crypto dominates transactions