RBI has major concerns on cryptocurrencies, flagged it to govt: Shaktikanta Das
Mumbai: The Reserve Bank has "major concerns" on the cryptocurrencies traded in the market and has conveyed the same to the government, its governor Shaktikanta Das on Thursday said.
Underlining that both the government and the RBI are "committed to financial stability", Das said there are no differences between the central bank and the Finance Ministry on the matter, and "we should now await the final decision on the matter" from the Centre.
The comments come in light of what has been termed as confusing signals from the government on the cryptocurrencies. After announcing its intent to completely ban such currencies, which are very volatile in nature without any underlying principle guiding its values, the government had shown some openness to such currencies like Bitcoin.
Speaking at the Times Network India Economic Conclave, Das said he has "reasons to believe" that the government is in agreement with the "major concerns" flagged by the RBI about the cryptocurrencies.
"Central bank digital currency is one thing. The cryptocurrencies which are traded in the market are something else. Both RBI and government are committed to financial stability. We have flagged certain concerns around these cryptocurrencies which are being traded in the market. We have flagged certain major concerns to the government," Das said.
He said the matter is still under the examination of the government, and a decision on this issue will be taken by it sooner than later.
It can be noted that the RBI had first banned such currencies through an order, which was struck down by the Supreme Court last year. The central bank's concerns stem from the non-fiat nature of such currencies which are touted as the future in some quarters, and in the volatile price movements in them. The RBI had also come out with an appeal cautioning people not to trade in such currencies in the past.
After the government proposed a complete ban on such currencies in a Bill presented in January, Finance Minister Nirmala Sitharaman had earlier this month said that she is all for encouraging experiments in the field, which was termed as a confusing signal in some quarters.
Das on Thursday said the RBI continues its work on a digital version of a fiat currency, and is currently "assessing the financial stability implications of introducing such a Central Bank Digital Currency (CBDC)".
"As the underlying technology is still developing, we are exploring ways for a clear, safe and legally certain settlement finality, which is most crucial for a secure and efficient payment system," he said.
Das added that there are not many "practical instances" of operationalisation of a CBDC globally, and this calls for "utmost precaution" before India goes ahead.
Meanwhile, Das said digital is the future across the banking landscape and "we will have a lot of shifts taking place on this front going ahead".
From a regulatory perspective, fostering effective regulations will be a priority for the RBI, he said, adding it is an endeavour not to constrain innovations but to promote those without compromising on financial sector stability, cybersecurity and customer protection.
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Dangerous explosives found outside Kerala school
Palakkad (PTI): Explosives found outside a school compound in Vadakanthara in this district on Wednesday were confirmed to be of a dangerous nature, according to the First Information Report (FIR).
The explosives were found on Wednesday evening when a student threw one of the devices--which are suspected to be used for eliminating wild boar--resulting in an explosion, causing minor injuries to both himself and an elderly woman nearby, police said.
The FIR states that Narayanan, a 10-year-old student, discovered the explosives near the gate of the Vyasa Vidhya Peedom pre-primary school compound in Vadakanthara at around 3.45 pm.
Excited over the discovery, he threw one of the explosives to the ground, which then exploded with a loud sound, injuring himself and 84-year-old Leela, who was standing nearby.
School authorities and residents rushed to the scene and called the police who searched the place and found four more explosives in a bucket.
The injured were taken to the hospital, and their condition is stable, said police sources.
Palakkad North police have registered a case under section 3(a) (causing an explosion that is likely to endanger life), section 4(a) (keeping explosives with an intention to endanger life and property) of the Explosive Substance Act, and section 75 of the Juvenile Justice (Care and Protection of Children) Act that deals with cruelty to children.
The FIR of the case stated that explosives were of a dangerous nature and were kept at the place to endanger human life.
A team led by a DySP-ranked officer is investigating the case.
According to police, CCTV cameras in the area have been recovered as part of the investigation, and attempts are being made to identify people who kept explosives near the school compound.
BJP district leaders alleged a major conspiracy behind the incident and demanded a thorough probe.
CPI(M) leaders alleged that the school management is affiliated with RSS, and there is training given to volunteers in the area.
Congress has also called for a detailed probe into the incident.
