On 27th August, the Reserve Bank of India [RBI] revealed that they had created their own working unit within the governing bank of the country to create a system that imbibes emerging financial system disruptors such as cryptocurrencies and blockchain technology.
An official associated with the RBI, whose name was not revealed stated that:
“As a regulator, the RBI also has to explore new emerging areas to check what can be adopted and what cannot. A central bank has to be on top to create regulations. This new unit is on an experimental basis and will evolve as time passes.”
The details of this month-old unit is still a highly guarded secret with a chief general manager set to be posted at the helm. The officials with an idea of what the body does, have stated that the main aim of such a move is to be clued into the revolution that is happening in the economic ecosystem and to ensure that the financial models in India are not outdated or pushed around.
This startling new revelation comes directly after Subhash Chandra Garg, the head of the Department of Economic Affairs had called cryptocurrencies some kind of a “Ponzi kind of scheme”, stating that the Reserve Bank of India has released advisories for this specific reason. This is also the reason the regulator has debarred banks from dealing with any aspect of the technology, with Garg referring to this move as “regulations”.
He had said:
The committee is studying the possibility of using cryptocurrencies or the crypto technology (distributed ledger technology) for financial transactions and also what kind of regulations are needed for that. [While] the currency is totally banned, the committee is discussing its other usage and how it can be be made mainstream in India.
Another official who has given his stance on cryptocurrencies is R Gandhi, a Former RBI Deputy Governor, who had earlier tagged cryptocurrencies as ‘assets’ and not ‘cryptocurrencies’.
The establishment of the new highly anticipated unit has given a boost to Giottus, an exchange platform that operates within India. The platform has reopened INR withdrawals and deposits, while still keeping in line with the rules and regulations specified by the RBI.
Giottus was one of the first exchanges to begin offering P2P in the country. It currently offers services for Bitcoin [BTC], Bitcoin Cash [BCH], Litecoin [LTC] Ethereum [ETH] and XRP. Vijay stated on the recent move:
“We were one of the first exchanges to launch P2P in India. We decided that the market needed a P2P after RBI bank fencing decision, as this was what was happening in China and other places. Since then, Giottus launched a P2P exchange solution along with normal exchange in April.”
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