Reserve Bank of India (RBI) Governor Shaktikanta Das warned citizens against investing in digital assets, fearing that the cryptocurrency market could collapse and private investors risk losing money.
Shaktikanta Das is convinced that cryptocurrencies can cause financial instability, as they have a negative impact on capital flows, and this can prevent the Central Bank from effectively determining monetary policy. Das warned that crypto assets could be used as a tool for money laundering and other illegal activities.
The RBI manager is also confused by the fact that digital assets are not backed by anything. According to him, what has no foundation cannot always remain at its peak, and will eventually collapse. Therefore, investing in crypto assets is especially risky for private investors, Das said.
He noted that he had repeatedly issued such warnings to the public. In June, amid the decline in the cryptocurrency market after the collapse of the Terra project, Das called crypto assets sophisticated frauds.
“I would like to believe that a large number of people pay attention to the concerns of regulators. I hope our cautions have kept many people from investing in overly volatile crypto assets,” Das said.
Previously, the RBI called on the Indian government to ban cryptocurrencies in the country. However, Indian Finance Minister Nirmala Sitharaman said it would be better to develop strict regulations for the oversight of the cryptocurrency industry, in which regulators from other countries should also participate in the creation.
In India, there is still no clear regulation that crypto companies must comply with, although the government has been working on relevant bills for several years.
Recently, the country’s finance ministry urged cryptocurrency investors to exercise extra caution. This is because the Enforcement Authority of India (ED) is investigating more than a dozen marketplaces for assisting in money laundering through crypto assets.
Source: Bits
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