RBI Governor Voices Concerns Over Cryptocurrency Impact on Financial Stability

The Reserve Bank of India (RBI) Governor Sanjay Malhotra has raised alarms over cryptocurrencies, emphasizing their potential to disrupt financial stability. His remarks came during a media interaction following the RBI's monetary policy announcement, amid ongoing discussions about crypto's regulatory framework in India.

The Supreme Court recently mandated the government to establish well-defined regulations regarding cryptocurrency, highlighting its significant influence on the economy. A bench equated Bitcoin trading to questionable activities like 'hawala' business, underscoring the urgent need for oversight.

As cryptocurrency remains unregulated in India, an inter-ministerial group is crafting a discussion paper to guide future policy. Despite the government's tax provisions on crypto gains, these digital assets lack explicit legal status, underscoring the importance of the forthcoming policy discourse.

(With inputs from agencies.)