The Indian central bank Reserve Bank of India (RBI) has established a task force that will assess the possible granting of legal tender status to Bitcoin and other virtual currencies. The central bank is also eyeing to draft a cryptocurrency regulation in the near future. The central bank is also considering digitizing the rupee.
There is no clear plan of action yet on how the central bank will approach the regulation of the virtual currencies. However, this move by the RBI is expected to make India as one of the hottest countries for digital currencies in the near future.
A number of governments around the world are currently having difficulty in creating an appropriate definition for Bitcoin and other virtual currencies. This is no real surprise considering the novelty and the risk blockchain technology poses to economists and bankers together.
To deal with it, some governments are implementing strict regulations to handle it and as a form of a very cautious approach. Other countries are just allowing the use of the cryptocurrencies without any regulation as this could create more confusion to everyday consumers.
Despite the negative stance shown by the Indian government to digital currencies in the past, the move by the RBI showed that the government is adopting an open-minded approach toward regulating the cryptocurrencies. Any decision that will be made by the central bank in the near future is expected to have a major effect on how Bitcoin and other virtual currencies will be accepted in the country.
Many financial industry players expect that the RBI will decide positively on regulating the virtual currencies. However, the central bank is also expected to impose some restrictions on the use of the cryptocurrencies. These expectations are premised on the fact that India stands to benefit substantially if it decides to adopt the various digital currencies.