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Finance Minister Nirmala Sitharaman has flagged anonymity as an ‘inherent risk’ in blockchain technology and called for taking precaution in future with a rise in the use of this technology. She made it clear that using the distributed ledger technology (DLT), which is also called as blockchain, is absolutely imperative and the government also supports the use of the same. Her remarks come ahead of the launch of the budgetary announcement of central bank digital currency (CBDC) which is based on the blockchain technology itself and is billed as being similar to the paper currency carried in wallets.

Sitharaman said ‘the anonymity is what ... one unknown element in this whole thing. The anonymity of the person or whoever or the robot is the one which we have to be absolutely readying ourselves as a future challenge’. She said the DLT is a beautiful technology which will help in democratisation but flagged anonymity as an inherent risk which we need to guard ourselves from. Terming anonymity as a powerful imponderable in the whole equation, she said ‘unless we are able to guard ourselves against that anonymous element which can itself pose an inherent risk, we probably will be exposing ourselves much more than ever we would have imagined’.

Besides, she said the retail investment journey has transformed in the last two or three years, with new demat account opening zooming to 26 lakh per month in FY22 from 12 lakh in FY21 and just 4 lakh a month in FY20. She said the retail investors act as shock absorbers as the foreign portfolio investors have come in and gone as per the global cues. Pointing out to the total $4 trillion in custody value held by NSDL, she said the buoyancy in retail account opening is a prime reason for the high asset value.