Kevin Helms
A student of Austrian economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects and the intersection of economics and cryptography.
India’s Reserve Bank Governor Warns Crypto Market Could Crash and Retail Investors Will Lose Money – Markets & Prices Bitcoin News
RBI Governor Shaktikanta Das has warned that the crypto market may crash and small investors will lose money. He added that the central bank believes that the warnings have deterred many people from investing in cryptocurrencies.
RBI Governor’s Crypto Warnings
Reserve Bank of India (RBI) Governor Shaktikanta Das warned against investing in cryptocurrency in an interview with ET Now earlier this week.
Noting that the RBI has on several occasions warned investors about the risks of investing in crypto, Das said, “I am glad that we gave these warning signs and I would like to think that a large number of people would have taken note of the warning signs and concerns as expressed by the Reserve Bank.” He added:
I would think … that a lot of people didn’t invest in crypto or kind of pulled out of crypto thanks to the warnings and concerns that came out of the Reserve Bank.
“Crypto, you know, we’ve said it before, it can create a lot of financial instability in terms of the central bank’s ability to decide monetary policy,” the RBI governor continued. “It will also have a negative impact on our exchange rate, on capital flows, on the stability of the banking sector.”
Furthermore, Das warned that cryptocurrency has “the potential to be used as a tool for money laundering and for the illegal transfer of money.” He also repeated his earlier statement: “In fact at one point I said it has no underlying, not even a tulip.”
The Governor of the Reserve Bank of India said:
Something that has no underlying, prices won’t stay high all the time, so therefore it can crash, and it has crashed, ultimately … it’s the small investors who lose money, so therefore there is a big risk of the small investors.
Das said in July that cryptocurrencies are a clear danger. In May, he warned about crypto amid a market selloff. “We have warned against crypto and are looking at what has happened to the crypto market now,” the governor said after the collapse of cryptocurrency terra (LUNA) and stablecoin terrausd (UST).
The RBI has recommended that the Indian government ban cryptocurrencies, including bitcoin and ether. However, Indian Finance Minister Nirmala Sitharaman said both bans and regulation can only be effective with “significant” international cooperation.
India still does not have a specific regulatory framework for cryptocurrency. The Indian government has been working on a crypto law for several years, but it has yet to be taken up in parliament. Recently, the finance minister asked crypto investors to exercise caution as authorities investigate a number of crypto exchanges in money laundering probes.
What do you think about the comments of RBI Governor Das? Let us know in the comments section below.
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