The ongoing 2024 session of the annual World Economic Forum (WEF) in Davos has brought together leaders of global finance industry under one roof. The topic of cryptocurrencies is gaining major traction among speakers and attendees, with industry experts shading divided opinions around the niche and upcoming financial technology. Speaking at the event, RBI governor Shaktikanta Das said India is being very careful around embracing crypto, the main reason being the highly speculative nature of cryptocurrencies.
“Cryptos have huge risk, particularly for emerging market economies because it can impact your financial stability, currency stability, and monetary system. Cryptocurrency is highly speculative,” the media quoted Das as saying in Davos on January 16.
While praising the growth of India’s banking sector, Das did not give any statement supporting the growth and acceptance of crypto in India. He did, however, note that the blockchain technology should be capitalised on.
What’s the future of crypto currencies in India sir, an interviewer asks RBI governor Shaktikanta Das in Davos.
“Very bad”, pat comes the response.
Unambiguous, consistent signal.
— SK (@sruthijith) January 16, 2024
In the last few months, not only has India brought crypto under its tax regime, but has also laid out regulations for national and international firms to adhere to, in order to legally operate in the country. Despite India’s active role in drafting crypto laws for G20 nations last year, it remains unclear as to why the RBI continues to show reluctance to support the sector.
Meanwhile, other members of the international Web3 community have come forward to applaud the representation of crypto in Davos this year. As per Monica Long, the president of financial and cryptocurrency services company Ripple – discussions around crypto in the WEF is ‘crucial’ for the overall industry. Long believes that dialogue around the crypto technology is the only way to separate the benefits of cryptocurrencies from all the hype that surrounds them.
“It’s critical for our industry to be represented at Davos by mature players who can help dispel the hype that often distracts from the real work being done. The industry needs to engage with governments to ensure that sound policy and regulatory frameworks are established,” reports quoted the Ripple official as saying.
The volatile nature of crypto assets and the element of anonymity that crypto transactions boast of – are top reasons of concerns for the governments of several nations around the world. It is however notable, that in the last couple of years, the crypto sector has witnessed major ups and downs that has led to a more mature market understanding by the community members. Market analysts predict that the industry is bound to stabilise with more nations adopting regulatory methods like EU’s MiCA legislation and G20’s crypto roadmap.
In the second week of January 2024, the Securities and Exchange Commission of the US took a historic decision to approve 11 BTC ETFs – that would let people engage with BTC via traditional stock market platforms, without having to register on a crypto exchange.
Despite this landmark decision, the Bitcoin community managed to maintain the asset price around $42,000 (roughly Rs. 35 lakh), instead of going overboard with buying and selling and leaving the overall market topsy turvy. For now, crypto ETFs are neither proposed nor approved in India. The country is still gradually laying out regulations to safeguard cryptocurrencies against volatility and misuse.
