The fintech industry’s next logical successor or extension could be cryptocurrency, it has the potential to work as a payment method as well. But according to Minister of State for Electronics and IT Rajeev Chandrasekhar, the real challenge lies in the usage of crypto as an asset class and it being an alternative to currency. While speaking on the sidelines of the Fintech Festival, Minister of State for Electronics and IT Rajeev Chandrasekhar said that almost the whole world is trying to grapple with the issue of cryptocurrency and needs to come to a logical conclusion on the means and ways to address it.
“Crypto as a means of payment is logical extension of fintech but crypto as an asset class and crypto as a substitute for currency is an area with which all currencies of the world and all regulators of the world are struggling with. We will find our way with prudence, caution. We have completely clear objective as to who will do crypto in India. The government has said that RBI will do crypto the digital rupee as first measure and then we see how market evolves,” said Minister of State for Electronics and IT Rajeev Chandrasekhar.
Central Finance Minister Nirmala Sitharaman said that RBI has expressed concerns about cryptocurrency and that it could have a destabilising effect on fiscal and monetary stability. Furthermore, she added that the value of currencies is regulated and anchored by monetary policies and their status as legal tender. But cryptocurrency relies solely on speculations and expectations of higher returns and cannot be well anchored.
RBI is working on a Central Bank Digital Currency (CBDC), which was announced in the Union Budget 2022-23 by the Finance Minister. CBDC is a digital currency and it does not represent any debt or liabilities as there is no issuer.