The Reserve Bank of India (RBI), which is the central authority overseeing banking in India, has opened a dedicated department for fintech that will help create regulations for cryptocurrency and its upcoming central bank digital currency (CBDC), says a report by Coindesk.
The report also said that the bank is working on two kinds of CBDCs — wholesale and retail — and that the new department will be tasked with overseeing their development. The department will be overseen by Ajay Kumar Choudhary, who is currently the chief general manager of the RBI.
RBI’s past with cryptocurrency
To be sure, the department is meant to oversee “new age challenges” arising from fintech applications, and crypto is only a part of its brief, which means that while the department will oversee cryptocurrencies and their challenges, it may not necessarily be first on its agenda.
The RBI, and particularly its governor Shaktikanta Das, has been one of the most vocal opposers of cryptocurrency in India. Das has warned against the use of cryptocurrency in the country on multiple occasions, and raised concerns about the increasing amount of wealth being put into crypto trading in India.
While an exact estimate of the total number of crypto traders and users in India isn’t readily available, the country’s largest crypto exchange have claimed to have millions of users.
Nischal Shetty, the founder of WazirX, which is said to be the country’s largest crypto exchange by trading volumes, has claimed that the country had a total of 20 million crypto users in the fourth quarter of CY2021.
Where does India’s crypto legislation stand?
India has also been formulating a law to regulate cryptocurrencies for the better part of a year now. The bill in question first appeared on the agenda for the budget session of the Parliament in January 2021, but wasn’t tabled during the ensuing session. Finance Minister Nirmala Sitharaman and other ministers have also dropped hints of what the bill may contain, and it also appeared on the agenda for the recently concluded Winter Session of the Parliament.
The RBI’s move may come as good news for the industry, which has been asking for crypto regulations for quite a while now.
The article originally published on Business Insider.