According to Livemint’s report today on May 8, the Reserve Bank of India has taken measures to curb the cryptocurrency trade against the rupee and set up a group to discuss its own digital currency.
The digital currency issued by the central bank can make cash flow less.
Sujatha Mohan, director of the RBL Bank figures and new initiatives, said: “This is a step in the right direction. When we talk about digital currency instead of virtual currency , it already Digital wallets exist in the form. We have been working hard to reduce the amount of cash that digital currency can help ensure. On the executive level, the digital currency will need to be in a more natural way and it must become part of the daily routine. When it comes to a more structured approach to holding money, it will be different.”
RBI support for encryption technology is premature.
Praveen Kumar, chairman and chief executive of Belfrics Global SDH, said: “For the central bank, The market is not mature enough to test in the national currency, and regulators and governments are still ignorant about how to effectively supervise the existing cryptocurrency market. At this time, it is recommended that financial institutions stay away from cryptocurrency service providers and issue the country’s own encryption currency will not be very good.“
Praveen Kumar believes that the reserve Bank of India needs to adopt Wait and see attitude, and the public to understand how the current market dynamics block chain cooperation. In addition, the issuance of national currencies involves many basic risks. What is needed now is to find an effective way to supervise the existing cryptocurrency market and prepare for the future issuance of a national cryptocurrency and when the market will mature.
Axis Bank chief economist Saugata Bhattacharya said the central bank digital currency (based blockchain and other distributed ledgers) allows regulators direct, instant access to bank information by Regulators participate in classified billing (security-based licensing systems) and can replace regulatory reports.
Once the central bank issues national digital currency, the central bank will face various challenges related to stability and security. Cyber-security risks are becoming more apparent, just like the volatility of digital currencies .
In addition, this currency can combine the security of bank notes with the convenience of bank accounts. Depositors who purchase currency directly from the central bank will deprive the banks of their deposit reserves, forcing them to pay higher interest rates to depositors, thereby affecting the banks’ profitability and ability to lend. In fact, the structure of the banking industry itself may change, and cross-border transfers and demand for agency banks will also disappear.
Digital currency is likely to be the future of banking transactions in India DBS Bank.
Head of consumer banking (DBS Bank India) Sen Tanu Sengupta (Shantanu Sengupta), said: “What we need, is a use of blockchain of security, achieved as a unit of account, a store of value and one triple exchange ideal target medium of digital currency . Blockchain technology may eventually form a digital currency core transactions. its advantage may be faster, more accurate transaction processing, greater efficiency and transparency, financial inclusion, and significant savings in printing and distribution.”
Shantanu Sengupta believes that this is an exciting development and the committee’s recommendations may give rise to further discussions and recommendations on effectiveness and implementation.