Traders Body CAIT Welcomes RBI's Advice To Ban Cryptocurrency That Is 'bad For Economy'

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After Finance Minister Nirmala Sitharaman informed that the Reserve Bank of India (RBI) is in favour of banning cryptocurrencies, the Confederation of All India Traders (CAIT) on Monday welcomed the proposed ban. 

“The way the Reserve Bank of India has spoken about banning cryptocurrency in India, the Confederation of All India Traders welcomes it. Cryptocurrency is not good for the Indian economy. It causes harm to the investors of the country. Until any legislation, crypto should not be allowed to function in India,” said Praveen Khandelwal, Secretary General of the Confederation of All India Traders (CAIT). 

Earlier in the day, FM Sitharaman told the Lok Sabha that the RBI is in favour of banning cryptocurrencies while responding to a question on whether the RBI had registered concern over the adverse impact of cryptocurrency on the Indian economy. Sitharaman was also asked to clarify whether it had recommended framing suitable legislation to control the flow of cryptocurrency in India and the Centre’s stance on the same.

The Finance Minister said, “In view of the concerns expressed by the RBI on the destabilizing effect of cryptocurrencies on the monetary and fiscal stability of a country, the RBI has recommended for framing of legislation on this sector. The RBI is of the view that cryptocurrencies should be prohibited.”

Sitharaman, on February 1, had presented the Union Budget 2022-23 wherein she had announced that the Centre would impose a 30% tax on cryptocurrencies. During the Budget Session, she also introduced the digital currency to be issued by the RBI.

On February 4, Sitharaman had told Republic Media Network’s Editor-in-Chief Arnab Goswami in an exclusive conversation that the taxing of cryptocurrency does not mean its legitimate.

RBI to issue ‘Digital Rupee’

Finance Minister Nirmala Sitharaman had earlier declared in her Budget speech that RBI will start issuing digital currency from 2022-23. Stressing that this will give a big boost to the digital economy, she mentioned that the digital rupee will be introduced using blockchain and other technologies. According to Sitharaman, this would pave way for a more efficient and cheaper currency management system.