MUMBAI (CU)_In March last year, the Supreme Court of India revoked a ban on cryptocurrencies imposed by the Reserve Bank, with the three-judge bench ruling the prohibition as ‘disproportionate’. Since then, the craze in the South Asian nation over digital currencies grown at an aggressive rate, prompting the central bank governor to issue warnings cautioning investors regarding the potential pitfalls linked to these digital assets.
Sharing his views in this regard, RBI governor Shaktikanta Das on Wednesday (10 November) noted that cryptocurrencies remain a very serious concern from a macro economic and financial stability point of view. During the Supreme Court hearing in early 2020, the Internet and Mobile Association of India (IAMAI), whose members include cryptocurrency exchanges, argued that by taking digital currencies out of the banking channels, the RBI is impeding the ability of law enforcement to regulate illegal activities in the industry.
So far, the Union government has not enacted any statute on cryptocurrencies, but lawmakers are said to be in consultation with industry experts. Some officials believe that after several rounds of warnings issued to the public, the government may intend to set strict limits on trading digital currencies in India, in the view of larger public interest.
Earlier this week, the world’s largest cryptocurrencies by market value hit record peaks, as enthusiasm for virtual currency adoption and worry about inflation accelerating momentum. Accordingly, on Tuesday (9 November), Bitcoin rose as high as $68,564.40, followed by Ethereum reached $4,842.65. Recent figures show that both have more than doubled since June and have added nearly 70 per cent against the dollar since the start of October.
Over the past year in particular, cryptocurrencies have reported massive gains, with the decade-old market having grown by about four times from its 2020 year-end value. According to Bloomberg News, the total value of all digital currency assets has just exceeded $3 trillion.
