RBI tightens rules of virtual currency and plans to launch own cryptocurriency " #Lakshmi# ".
India's central bank, RBI declared news about virtual currencies dealing in Indiashould be banned and given instructions to other banks to virtually stop providing services to individuals or business dealings of digital currency like Bitcoin and other cryptocurriencies. RBI had given three months of time for all the banks to unwind all the services or their positions with the entities in relation to digital currency.
India's central bank governor, reported "If cryptocurrencies grow beyond a critical size they can endanger financial stability".
The move comes due to unregulated nature of virtual currency, mainly the popular cryptocurriency " Bitcoin" meteoric rise In its value triggered worries that virtual currencies might facilitate money laundering to tax evasion and fraud.
This move has caused demonetisation effect of cryptocurriencies, people lose their ability to conduct any trade or exchange in open markets.
India is not completely giving up the idea of cryptocurriency. An interdepartmental committee had been constituted by RBI. This group will provide guidance about feasibility and desirability of fiat digital currency. This committee will submit their report by June. Some of media reports that mulling of introduction of new fiat virtual currency will be named as " Lakshmi". Several central banks were interested in introduction of fiat digital currency. The liability of the cryptocurriency will also be under central banks rather than private digital tokens.
What could be the future of cryptocurriencies? Any guesses...
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