RBI raises concern about Stablecoin’s effect on Indian Rupee

December 28, 2021

The Reserve Bank of India is still concerned about the cryptocurrency. This time RBI has shown it’s concern towards Stablecoins and thinks that Stablecoin being pegged to USD currency or any other countries currency alone could undermine the value of Indian currency, according to reports of local media houses.

According to reports, these concerns have been shared with the government on several occasions. RBI is majorly concerned about what would happen when major companies and traders in the near future start using the stablecoin where usually Rupee would be used. Further,RBI has also noted that increased usage and acceptance of stablecoins in the country could even hinder central bank’s ability to control currency fluctuations and volatility. Further, some local media reported that, RBI’s concerns over exchanges providing high-interest rates on stablecoin deposits. They were as high as 10%-12% which is more than those for fixed deposits, further enticing investors.

RBI has also sent a proposal to the government recently, to widen the scope of ‘bank note’ to include the CBDC. So, despite the other news, CBDC is currently underway in India.

Source: AMB Crypto

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