RBI officials explain their worries about crypto in India.

Top RBI officials told a parliamentary panel that cryptocurrencies could lead to a part of the economy being “dollarized,” which would be bad for India’s sovereignty.

Top RBI officials told the Parliamentary Standing Committee on Finance, which was led by the former finance minister Jayant Sinha, that they were worried about cryptocurrencies and that they could make the financial system less stable.

A member of the panel was quoted as saying, “It will seriously hurt the RBI’s ability to set monetary policy and oversee the country’s monetary system.”

Even though central bank officials agree that cryptocurrencies have the potential to become transactional currencies that could replace the rupee, they still have their doubts. They said that while these currencies “can replace a part of the monetary system,” they will also make it harder for the RBI to control how money flows through the system.

Central bank officials say that cryptocurrencies are not only used to fund terrorists, launder money, and sell drugs, but they also pose an even bigger threat to the stability of the country’s financial system.

Even though “dollarization” of the Indian economy is what banking officials are most worried about when it comes to cryptocurrencies, they are also worried about what cryptos could do to the Indian banking system.

RBI officials said that cryptocurrencies will hurt the banking system because people will start putting their hard-earned money into cryptocurrencies. This means that the bank will have less money and resources to lend out.

There are between 15 and 20 million people in India who invest in cryptocurrencies right now.

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