The Reserve Bank of India appears to be taking a softer stance on the crypto industry, as the central bank has reportedly set up a new fintech department to regulate crypto exchanges and more. According to reports, this information comes courtesy of an internal circular dated January 7, 2022.
Operational since January 4, 2022, this new department will now be the point of contact in RBI for all fintech-related activities, including crypto-related issues as well. In the future, this department is also expected to help create regulations for cryptocurrency and even its upcoming central bank digital currency (CBDC).
The new report is interesting as the RBI in the past has advocated for a complete ban on cryptocurrency in India. It had recently done so at last months RBI’s 592nd central board of directors meeting held in Lucknow on December 17th, 2021. The central bank had previously banned crypto exchanges in India in 2020. However, that was later lifted by the Supreme Court.
For its part, the government is still deliberating its approach to tackle cryptos. Reports suggest it is currently thinking of changes to the proposed legislation’s framework for cryptos, which would mean the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, will now be tabled in the next session of the parliament.
It is of the opinion that some aspects of the bill need more deliberation, discussions, and comments from the public. These include the government bringing in a Central Bank Digital Currency (CBDC) which will be recognised under the RBI Act. Another reason for this is the government's belief that the new law for cryptocurrencies needs to be in line with a global framework which is still a work in progress.
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