The Reserve Bank of India (RBI) is chaired by India The priority of the G20, which serves as a country, is to “develop a global regulatory framework that includes a ban, or potential ban, on unbacked cryptoassets, stablecoins, and defi.” The Central Bank of India has warned that “crypto asset market turmoil” is one of the “major risks that could undermine global financial stability.”
Central Bank of India on Crypto Regulation
India’s central bank, the Reserve Bank of India (RBI), released its December Financial Stability Report (FSR) on Thursday. announced. The 172-page report includes discussions on cryptoassets, central bank digital currencies (CBDC), and decentralized finance (defi).
“It is difficult to regulate new technologies and business models that have grown to the systems level,” said his RBI report. “It is imperative that policymakers design appropriate policy approaches to foster responsible innovation and mitigate financial stability risks in the cryptocurrency ecosystem.” The Central Bank of India continued:
In this regard, one of the priorities under India’s G20 presidency is the banning of unbacked cryptoassets, stablecoins, and defi.
The central bank named “crypto asset market turmoil” as one of the “major risks that could undermine global financial stability.” The RBI also said crypto-assets are highly volatile, “highly correlated with equities” and declining as inflation rises.
The report further points out that the collapse of cryptocurrency exchange FTX and the subsequent plunge in the cryptocurrency market “highlighted the vulnerabilities inherent in the cryptocurrency ecosystem.” Also focused on the Terra/Luna meltdown in May and the bankruptcy filings of several major crypto companies, including crypto hedge fund Three Arrows Capital (3AC) and crypto lender Celsius Network. is guessing.
G20 Members Discuss Cryptocurrency Regulation
India’s Economic Affairs Secretary Ajay Seth said earlier this month that G20 members should discuss cryptocurrency policies for better global regulation. The aim is to build consensus, he said. Indian Finance Minister Nirmala Sitharaman said in October that cryptocurrencies would be part of India’s agenda for G20 presidency, adding that he hopes a technology-driven regulatory framework for crypto assets will be established. .
The members of the G20 (G20) are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia and Saudi Arabia. , South Africa, Turkey, UK, USA, European Union. This group accounts for about 85% of the world’s GDP.
However, India’s central bank has repeatedly recommended banning all state-issued cryptocurrencies, including Bitcoin and Ether. Last week, RBI Governor Shaktikanta Das warned that cryptocurrencies would trigger the next financial crisis if not banned. However, India’s finance minister said in July that significant international cooperation would be required for both the ban and regulation of cryptocurrencies to take effect.
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