India Contemplates Cryptocurrency Ban to Boost Digital Rupee Adoption

India is currently weighing a potential ban on private cryptocurrencies like Bitcoin and Ethereum, as the government pushes for the adoption of its Central Bank Digital Currency (CBDC), the digital rupee. This move comes in response to growing concerns about the risks posed by decentralized digital assets, with authorities arguing that CBDCs can provide the same benefits as cryptocurrencies without the associated financial and security risks.

The Reserve Bank of India (RBI) has been promoting the digital rupee since its launch in late 2022, with more than five million users and 16 banks participating in the initiative. The government aims to increase its adoption by integrating it with the Unified Payments Interface (UPI), a widely used payment system in India.

Officials believe that the CBDC offers more control over financial transactions and user data, while also mitigating the speculative risks associated with private cryptos. A formal policy is expected to be released soon, potentially paving the way for stricter measures, including a ban on private cryptocurrencies​

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