View: Compelling reasons why India should let the crypto cat out of the bag

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Fear of cryptos complicating monetary policy is structurally unfounded.

Synopsis

If cryptos lack ‘money-ness’, BharatCoin, the presumptive name for an RBI-issued digital currency, would be a natural evolution of digitisation of financial flows. India has been at the global forefront of digitisation for decades now. BharatCoin won’t replace cash. But it has the potential to change monetary policy operations and financial markets in a manner that would rival the onset of central bank-governed fractional reserve banking.

Cryptocurrency is an idea whose time has come. However, in India, cryptos remain a Schrödinger’s cat — not quite alive, but also not quite dead. GoI’s recent proposed legislation seems to wish to kill one aspect of this ‘alive-dead’ state by banning private cryptos and invigorating the other by okaying a central bank digital currency (CBDC) issued by RBI.Fear of cryptos complicating monetary policy is structurally unfounded. For a while now,

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