The Chief Economic Adviser of the Government of India warns of innovations such as cryptocurrencies and decentralized finance (defi) in the absence of regulation. “We may not fully recognize or understand the type of power we unleash,” he said.
Chief Economic Adviser of the Government of India, skeptical of cryptocurrencies, defy and decentralization
V. Anantha Nageswaran, Chief Economic Advisor to the Government of India (CEA), reportedly warned at an Assocham event on Thursday about the dangers of cryptocurrencies and the risks posed by lack of regulation. Regarding cryptocurrencies, he was quoted from the local media as follows:
Their lack of more decentralized, oversight and centralized regulatory agencies means that the “winners” can actually rob everything from the Piracy world of the Caribbean, or anyone else. It also means that there is a world that “takes everything away.”
The government’s economic adviser explained that he had agreed with T. Rabi Sankar, Vice President of the Reserve Bank of India (RBI), on cryptocurrencies and decentralized finance (defi). RBI officials have warned that there now seems to be cases of arbitrage transactions on cryptocurrencies and defy rather than true financial innovation.
Nageswaran describes defi as follows:
In my opinion, it is considered innovation, but it determines whether it is truly innovative, truly destructive in a positive sense, or something we regret.
Commenting on whether cryptocurrencies could be an alternative to fiat currencies, economic advisers emphasized that “many purposes need to be met.” He details: “It must be a valuable store, it must be widely accepted, it must be a unit of account … In all of these cases, new” innovations “such as cryptocurrencies and defy are still being tested. I haven’t passed. “
Nageswaran concludes:
So I’m not very excited about them because sometimes we can’t fully recognize or understand the kind of power that unleashes them.
“I would be wary to some extent by welcoming some of the fintech-based turmoil such as defi and crypto,” he said.
The Government of India is currently working on the national cryptographic policy.Treasury consultation We are working with the International Monetary Fund (IMF) and the World Bank on cryptocurrency regulation. Last week, the Securities and Exchange Commission of India (SEBI) Said The decentralized nature of cryptography makes it difficult to regulate.
Meanwhile, the central bank of India remains skeptical of cryptography. On Friday, RBI Governor Shaktikanta Das warned investors about cryptocurrency trading, repeating:Brings great risk For financial stability. “
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