India’s RBI Stands Firm Against Cryptocurrencies Amid Regulatory Uncertainty
The Reserve Bank of India (RBI) continues to oppose cryptocurrencies,emphasizing potential risks to the country’s monetary policy and financial stability. RBI Governor Sanjay Malhotra reiterated this stance during a recent news conference.
Malhotra stated, “The RBI has consistently expressed concerns about the risks cryptocurrencies pose to financial stability and monetary policy. While a goverment committee is reviewing the matter, our stance remains unchanged.”
India’s Supreme Court is also urging the government to establish clear crypto regulations. Justices Surya Kant and N kotiswar Singh noted that prohibiting cryptocurrencies is not feasible given global financial advancements. The court has criticized the lack of regulatory frameworks, which has caused confusion in the digital asset space.
India’s crypto regulation saga began in 2018 when the RBI banned banks from servicing crypto businesses. However, the Supreme Court overturned this ban in 2020, citing constitutional rights violations. Following this, the RBI instructed banks not to block crypto transactions, providing temporary relief to the industry.
Despite these legal challenges, RBI Governor Shaktikanta Das has repeatedly warned about the “huge risks” cryptocurrencies pose to financial stability. He has called for a ban on all cryptocurrencies due to their potential to undermine India’s economic system.
In 2022, India introduced a 30% tax on crypto gains and a 1% TDS on transactions, one of the world’s highest crypto tax regimes. The RBI remains concerned about crypto’s role in money laundering and its impact on monetary policy effectiveness.
As the government committee continues its review, india is expected to release a comprehensive policy discussion paper in June 2025. This move comes under mounting pressure from the Supreme Court for regulatory clarity.
