Next financial crisis can be triggered by private cryptocurrencies if such instruments allowed to grow: Shaktikanta Das
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Pressing for the prohibition of instruments like Bitcoin, Reserve Bank of India (RBI) Governor Shaktikanta Das has warned that the next financial crisis can be triggered by private cryptocurrencies, if such speculative instruments are allowed to grow. Das has been staunchly opposed to such instruments and the RBI has gone till the Supreme Court with its contention. He said 'Cryptocurrencies… have huge inherent risks from macroeconomic and financial stability (perspective) and we have been pointing it out.’
The RBI governor stated that the developments over the last one year, which include the latest crash of cryptocurrency exchange FTX, which is termed as one of the biggest financial frauds in the history of the US, illustrate the threat posed by such instruments. He noted that private cryptocurrencies' valuation has shrunk from $190 billion to $140 billion and there is no underlying value for the market-determined price.
Das acknowledged that different jurisdictions are taking different stances on it, but the RBI would like to stick to its stance of prohibiting them completely. He said the origin of private cryptocurrencies lie in their intent to break the system, in not believing in fiat currencies introduced by the central banks and not believing in a regulated financial system.
