The Reserve Bank of India (RBI) will proceed with great caution in evolving the retail applications of the Central Bank Digital Currency (CBDC) and is willing to engage in a fair debate on crypto assets’ regulation despite strong views against legitimising them in the country.
While the RBI is committed to the goal of introducing the CBDC in 2022-23, Deputy Governor Michael Patra said there were several issues that need to be resolved in working out the retail usage of the CBDC.
“I think we will proceed very gradually. We will cross the river by feeling the pebbles [as] there are issues of privacy that are involved, issues of monetary policy transmission that are involved. There is also an issue of energy intensity of the whole process, if it is on a certain kind of technology,” he pointed out.
“So, at this time, what I would say is that we are proceeding very, very slowly, we will measure our steps and very calibratedly move in the direction,” Mr. Patra said in response to queries from economist Ajit Ranade at the Asia Economic Dialogue 2022, hosted by the External Affairs Ministry and Pune International Centre.
Asked about the prospect of banks lending money to buy crypto assets, the Deputy Governor said the debate on crypto assets is still underway in India and there are various aspects to be considered. “The RBI’s view is quite known actually on crypto. But we will engage in a fair debate and look at all sides of the argument,” he said.
