Reserve Bank of India has Created a Unit on Blockchain and Cryptocurrency

Reserve Bank of India has Created a Unit on Blockchain and Cryptocurrency

India’s central bank, the Reserve Bank of India (RBI) has formed a new unit to track emerging technologies such as those related to cryptocurrencies. The members of this new unit will be researching about blockchain and cryptocurrencies, drafting rules. In the future, the next step for this unit will be to supervise the development of digital assets, artificial intelligence technology and blockchain.

Two unnamed individuals who are familiar with the central bank’s plans commented on the matter. One of them stated,

As a regulator, the RBI also has to explore new emerging areas to check what can be adopted and what cannot. A central bank has to be on top to create regulations. This new unit is on an experimental basis and will evolve as time passes.

However, RBI has made no formal announcement about the new unit and has not responded to any media queries either. However, reports say that this unit was actually formed a month back and the bank’s management has already appointed the leader for this unit.

The Economic Times also notes another individual who commented on the matter. Piyush Sharma, the managing director of financial services for Asia Pacific and Africa, Accenture, stated that regulators are part of the system and need to understand and have a clear decision on what is acceptable and what is not. If they fail to do so, they will neither be able to protect the regulated industry nor the consumers who use it. According to him, this unit created by the RBI is the right thing to do at the time when technologies are transforming business models to a great extent.

He added,

This is true specially in the financial world where paper-based regulations are a passe’ due to the onset of digital technologies. It is extremely important and the right thing to do from RBI’s perspective.

RBI has created this unit despite the fact that it has issued multiple warnings to the public for engaging in cryptocurrency transactions. In December 2017, RBI highlighted the economic, financial and legal risks associated with cryptocurrencies. Furthermore, earlier this year, the central bank ordered all regulated financial institutions to stop providing services to businesses and individuals dealing in cryptocurrencies.

The social media response to this was fairly positive.

@CryptoKanoon tweeted,

RBI has reportedly formed a research unit for emerging technologies like Crypto, Blockchain and AI. Can it be seen as a corrective measure for Crypto Community’s sulk over RBI??

@TweetsByMayur tweeted,

After spending next 3-4 years in researching Tech they’ll come to the conclusion that Blockchain without Crypto is not possible at all.

@BdAss10 tweeted,

Don’t know what these guys are doing every day they forming new team but no final outcome is coming,most of the country is adopting this tech. & Many alrdy adopted.

@hemantbisht said,

I think Govt will ask us to use the Coin created by RBI for transaction(Banks<=>Exchanges). To keep the track record.

@NischalShetty tweeted,

RBI now has a blockchain unit! I hope they get more insights and understand how crypto is the future and there’s no way to stop it. Revolutionary technologies that do good for the world cannot be buried. You can only adopt and adapt #isupportcrypto

Indian officials are working on a regulatory framework for the cryptocurrency industry. Reports state that the drafts for these regulations should be available by September.

Read Also:RBI Admits Virtual Crypto Bank Was Without Prior Research

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Pallavi Janiani

Pallavi Janiani

Content Writer
I am studying Business and psychology at the university of Minnesota. Apart from learning about how the economy and the human mind works, I spend my time dancing with my bollywood fusion team, reading, writing, traveling, usually with a cup of coffee in my hand.