Bitcoin, Blockchain

Crypto Has Future in India, But Monopoly Might be a Roadblock Says Central Bank Exec

I can see a future here.

This was the thought of the erstwhile governor of Reserve Bank of India, Raghuram Rajan, who confessed that private cryptocurrencies like Bitcoin and even Facebook’s Libra are a vital player to come in the future once central banks roll out their digital currencies.

The Chief Economist and Research Director at the International Monetary Fund from 2003–2006, Rajan said during a CNBC podcast that wile these crypto are a thing in the coming years, he still throws a doubt that one of these digital currencies might only become problematic if it were to hold a monopoly.

Nonetheless, he believes that other private digital currencies will come in and make different roles a part of the intense competition to existing ones.

The former central banker also declared that Bitcoin would mainly act as a store of value or a speculative asset rather than a medium of exchange.

“Bitcoin is a bit like gold while Libra will be used for day-to-day transactions, Rajan also said.

There are also emerging concerns about banks issuing central bank digital currencies. As banks obtain a tremendous amount of information through CBDCs, people may not be comfortable sharing all their personal payment information at one time and platform.

He also added that banks would need to decide what data they want to collect and how they would want to use it.

Like the private digital currencies, there could be a “monopoly of the central bank digital currency without safeguards on the central banks use and management of the currency and the data that accompanies it.”Competition is still a good scenario.

Concluding the interview, he said that at its early stage, crypto would likewise experience challenges. Albeit these, he aims to see private digital currencies co-exist with central bank digital currencies and see which is the fittest of them all.

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