Would this cause the next financial crisis?
Cryptocurrencies pose a major systemic risk to our macroeconomic and financial stability
– He said Shaktikanta Das, head of the Reserve Bank of India at an event recently, is an example The recent crash of the FTX crypto exchange brought by the specialist. Das’ main concern is that, according to him, cryptocurrencies have no underlying, intrinsic value and are therefore highly speculative instruments – according to him, quite simply should be banned.
“Private cryptocurrency trading is one hundred percent speculative and I still think it should be banned… because if we let it all grow even if we try to regulate it,
please mark my words: the next financial crisis will be caused by private cryptocurrencies
The governor’s comments came in an environment where the central bank is pushing for the introduction of its own digital version of the Indian rupee. On December 1, the Reserve Bank of India began rolling out the digital rupee in select cities for retail use, with some users able to transact with the digital rupee through apps and mobile wallets.
The digital rupee is a manifestation of the Central Bank Digital Currency, i.e. CBDC. A number of central banks around the world are looking to issue digital versions of their own currencies, according to Das. CBDCs can speed up international money transfers and reduce logistical needs such as printing banknotes. The regulation of digital currencies has been in the spotlight even more this year
the value of the cryptocurrency market fell by $1.3 trillion after the high-profile crash of the FTX exchange.
Cover image: Yellow Dog Productions via Getty Images
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